Atlas Copco (OTCMKTS:ATLKY) and Agricultural Bank of China (OTCMKTS:ACGBY) Critical Analysis

Atlas Copco (OTCMKTS:ATLKYGet Rating) and Agricultural Bank of China (OTCMKTS:ACGBYGet Rating) are both large-cap industrial products companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, risk, valuation, dividends, profitability, earnings and institutional ownership.

Risk & Volatility

Atlas Copco has a beta of 1.09, meaning that its stock price is 9% more volatile than the S&P 500. Comparatively, Agricultural Bank of China has a beta of 0.37, meaning that its stock price is 63% less volatile than the S&P 500.

Insider & Institutional Ownership

0.0% of Atlas Copco shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Atlas Copco and Agricultural Bank of China’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Atlas Copco $12.93 billion 4.10 $2.11 billion $1.79 6.09
Agricultural Bank of China $178.52 billion 0.75 $37.38 billion $2.52 3.79

Agricultural Bank of China has higher revenue and earnings than Atlas Copco. Agricultural Bank of China is trading at a lower price-to-earnings ratio than Atlas Copco, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Atlas Copco and Agricultural Bank of China, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Atlas Copco 0 9 4 0 2.31
Agricultural Bank of China 1 1 0 0 1.50

Atlas Copco currently has a consensus target price of $123.17, indicating a potential upside of 1,030.49%. Given Atlas Copco’s stronger consensus rating and higher possible upside, equities analysts clearly believe Atlas Copco is more favorable than Agricultural Bank of China.

Profitability

This table compares Atlas Copco and Agricultural Bank of China’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Atlas Copco 16.71% 30.18% 14.23%
Agricultural Bank of China 20.93% 10.69% 0.84%

Dividends

Atlas Copco pays an annual dividend of $0.54 per share and has a dividend yield of 5.0%. Agricultural Bank of China pays an annual dividend of $0.60 per share and has a dividend yield of 6.3%. Atlas Copco pays out 30.2% of its earnings in the form of a dividend. Agricultural Bank of China pays out 23.8% 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. Agricultural Bank of China is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Atlas Copco beats Agricultural Bank of China on 9 of the 15 factors compared between the two stocks.

About Atlas Copco (Get Rating)

Atlas Copco AB, together with its subsidiaries, provides productivity solutions. The company operates through Compressor Technique, Vacuum Technique, Industrial Technique, and Power Technique segments. It offers piston compressors, oil-free tooth and scroll compressors, rotary screw compressors, oil-free blowers, oil-free centrifugal compressors, gas and process compressors, air and gas treatment equipment, and medical air solutions primarily for use in the manufacturing and process industries. The company also provides oil-sealed rotary vane, dry, and liquid ring vacuum pumps; and turbomolecular and cryogenic pumps, as well as abatement and integrated systems for the semiconductor and scientific, chemical process, food packaging, and paper handling industries. In addition, it offers pneumatic, hydraulic, and electric assembly tools, as well as control systems and associated software for safety-critical tightening; self-pierce riveting tools, dispensing equipment for adhesives and sealants, and flow drill fastening equipment; material removal tools, drills, and other pneumatic products; and machine vision solutions for customers in the automotive and general industries. Further, the company provides portable compressors, boosters, generators, lighting towers, pumps, and construction and demolition tools for civil engineering, oil and gas, construction, manufacturing, exploration drilling, and demolition industries, as well as specialty rental services. It operates in North America, South America, Europe, Africa, the Middle East, Asia, and Oceania. The company was founded in 1873 and is headquartered in Nacka, Sweden.

About Agricultural Bank of China (Get Rating)

Agricultural Bank of China Limited provides corporate and retail banking products and services. The company operates through Corporate Banking, Personal Banking, and Treasury Operations segments. It offers demand, personal call, foreign currency time, foreign currency call, time or demand optional, foreign exchange demand, foreign exchange call, foreign exchange time, certificates of deposit, savings, agreed-term, and negotiated deposits; and loans comprise housing, consumer, business, fixed asset, working capital, real estate, and entrusted syndicated loans, as well as trade finances, guarantees and commitments, and loans with custody of export rebates accounts. The company also provides credit card, debit card, payment and settlement, private banking, cash management, investment banking, custody, financial market, and financial institution services, as well as trading and wealth management services; and personal fund collection and automatic transfer services. In addition, it offers agro-related personal and corporate banking products and services; personal and online, telephone, mobile, self-service, television, and SMS banking services; financial leasing services; fund management services; assets custodian services; debt-to-equity swap and related services; and life, health, and accident insurance, as well as reinsurance products. As of December 31, 2021, the company had 22,807 domestic branches, including three specialized institutions, 4 training institutes, 37 tier-1 branches, 402 tier-2 branches, 3,348 tier-1 sub-branches, 18,961 foundation-level branch outlets and 50 other establishments; and 13 overseas branches in Hong Kong, Singapore, Seoul, New York, Dubai International Financial Centre, Tokyo, Frankfurt, Sydney, Luxemburg, Dubai, London, Macao, and Hanoi; and four overseas representative offices in Vancouver, Taipei, Sao Paulo, and Dushanbe. Agricultural Bank of China Limited was founded in 1951 and is based in Beijing, the People's Republic of China.

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