Contrasting Brother Industries (OTCMKTS:BRTHY) and Randstad (OTCMKTS:RANJY)

Brother Industries (OTCMKTS:BRTHYGet Rating) and Randstad (OTCMKTS:RANJYGet Rating) are both mid-cap computer and technology companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, valuation, earnings, analyst recommendations, risk, institutional ownership and dividends.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Brother Industries and Randstad, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Brother Industries 0 2 0 0 2.00
Randstad 1 5 2 0 2.13

Randstad has a consensus target price of $58.00, indicating a potential upside of 115.97%. Given Randstad’s stronger consensus rating and higher probable upside, analysts clearly believe Randstad is more favorable than Brother Industries.

Volatility and Risk

Brother Industries has a beta of 1.01, meaning that its share price is 1% more volatile than the S&P 500. Comparatively, Randstad has a beta of 1.34, meaning that its share price is 34% more volatile than the S&P 500.

Valuation and Earnings

This table compares Brother Industries and Randstad’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Brother Industries $5.74 billion 0.81 $222.92 million $1.97 18.05
Randstad $29.15 billion 0.34 $908.62 million $2.58 10.41

Randstad has higher revenue and earnings than Brother Industries. Randstad is trading at a lower price-to-earnings ratio than Brother Industries, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Brother Industries and Randstad’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Brother Industries 4.20% 5.45% 3.74%
Randstad 3.18% 18.42% 8.21%

Dividends

Brother Industries pays an annual dividend of $0.80 per share and has a dividend yield of 2.2%. Randstad pays an annual dividend of $0.97 per share and has a dividend yield of 3.6%. Brother Industries pays out 40.6% of its earnings in the form of a dividend. Randstad pays out 37.6% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Randstad is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Randstad beats Brother Industries on 11 of the 14 factors compared between the two stocks.

Brother Industries Company Profile (Get Rating)

Brother Industries, Ltd. manufactures and sells communications and printing equipment in Japan, the Americas, Europe, Asia, Oceania, the Middle East, Africa, and internationally. It operates through six segments Printing & Solutions, Personal & Home, Machinery, Network & Contents, Domino, and Others. The Printing & Solutions segment offers inkjet printers; all-in-one black-and-white and color laser printers; fax machines and scanners; and electronic stationary comprising labeling systems, and label and mobile printers. The Personal & Home segment provides home sewing and cutting machines, sewing and embroidery machines, and commercial embroidery machines. The Machinery segment offers industrial sewing machines, machine tools, and garment printers, as well as industrial parts, such as reducers and gears. The Network & Contents segment provides online karaoke systems, music boxes, applications for smartphones/tablets, health care supporting equipment, and content services, as well as manages Karaoke clubs. The Domino segment offers coding and marking equipment, and digital printing equipment. The Others segment engages in real estate and other activities. The company was formerly known as Nippon Sewing Machine Manufacturing Co. and changed its name to Brother Industries, Ltd. in 1962. Brother Industries, Ltd. was founded in 1908 and is headquartered in Nagoya, Japan.

Randstad Company Profile (Get Rating)

Randstad N.V. provides solutions in the field of work and human resources (HR) services. It offers temporary staffing and permanent placement services for the light industrial, office and administrative, manufacturing and logistics, and other specialty areas, as well as payroll services. The company also offers on-site solutions for managing a client's workforce with specific skill sets and a fluctuating level of demand for the fast-moving consumer goods, automotive, life sciences, contact centers, manufacturing, and logistics, as well as the administrative and professional segments. In addition, it recruits experienced staff for managerial and professional roles in a range of sectors and disciplines, including IT, engineering, finance, healthcare, HR, education, legal affairs, sales and marketing and communications. Further, the company provides managed services programs, recruitment process outsourcing, outplacement and career development, and online talent acquisition. It has operations in North America, France, the Netherlands, Germany, Belgium, Luxembourg, Italy, Iberia, other European countries, and internationally. The company was formerly known as Randstad Holding NV and changed its name to Randstad N.V. in April 2018. Randstad N.V. was founded in 1960 and is headquartered in Diemen, the Netherlands.

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