Critical Comparison: RBC Bearings (NASDAQ:ROLL) versus Eastern (NASDAQ:EML)

Eastern (NASDAQ:EML) and RBC Bearings (NASDAQ:ROLL) are both industrials companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, risk, profitability, valuation, analyst recommendations, dividends and institutional ownership.

Insider & Institutional Ownership

69.2% of Eastern shares are held by institutional investors. 16.3% of Eastern shares are held by insiders. Comparatively, 2.8% of RBC Bearings shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Eastern and RBC Bearings’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eastern	2.51%	7.50%	3.60%
RBC Bearings	N/A	N/A	N/A

Analyst Ratings

This is a summary of current recommendations for Eastern and RBC Bearings, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eastern	0	0	0	0	N/A
RBC Bearings	0	0	0	0	N/A

Valuation and Earnings

This table compares Eastern and RBC Bearings’ gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eastern	$281.54 million	0.40	$12.30 million	$1.13	16.15
RBC Bearings	$1.14 billion	5.93	$59.60 million	$2.06	113.50

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

Risk & Volatility

Eastern has a beta of 1.06, meaning that its stock price is 6% more volatile than the S&P 500. Comparatively, RBC Bearings has a beta of 1.34, meaning that its stock price is 34% more volatile than the S&P 500.

Summary

RBC Bearings beats Eastern on 6 of the 11 factors compared between the two stocks.

About Eastern

The Eastern Company designs, manufactures, and sells engineered solutions to industrial markets in the United States and internationally. The company offers turnkey returnable packaging solutions, which are used in the assembly processes of vehicles, aircraft, and durable goods, as well as in production processes of plastic packaging products, packaged consumer goods, and pharmaceuticals; designs and manufactures blow mold tools and injection blow mold tooling products, and 2-step stretch blow molds and related components for the stretch blow molding industry; and supplies blow molds and change parts to the food, beverage, healthcare, and chemical industries. It also provides rotary latches, compression latches, draw latches, hinges, camlocks, key switches, padlocks, and handles; and development and program management services for custom electromechanical and mechanical systems for original equipment manufacturers (OEMs) and customer applications. In addition, the company designs and manufactures proprietary vision technology for OEMs and aftermarket applications, as well as offers aftermarket components to the heavy- and medium-duty truck, motorhome, and bus markets. The Eastern Company was founded in 1858 and is based in Shelton, Connecticut.

About RBC Bearings

RBC Bearings Incorporated manufactures and markets engineered precision bearings and components in the United States and internationally. It operates through two segments, Aerospace/Defense and Industrial. The company produces plain bearings with self-lubricating or metal-to-metal designs, including rod end bearings, spherical plain bearings, and journal bearings; roller bearings, such as tapered roller bearings, needle roller bearings, and needle bearing track rollers and cam followers, which are anti-friction products that are used in industrial applications and military aircraft platforms; and ball bearings include high precision aerospace, airframe control, thin section, and industrial ball bearings that utilize high precision ball elements to reduce friction in high-speed applications. It also offers mounted bearing products include mounted ball bearings, mounted roller bearings, and mounted plain bearings; and enclosed gearing product lines, including quantis gearmotor, torque arm, tigear, magnagear & maxum, and controlled start transmission. In addition, the company produces power transmission components include mechanical drive components, couplings, and conveyor components; engineered hydraulics and valves for aircraft and submarine applications, and aerospace and defense aftermarket services; fasteners; precision mechanical components, which are used in various general industrial applications; and machine tool collets that are used for holding circulars or rod-like pieces. It serves automotive, tool holding, agricultural and semiconductor machinery, commercial and defense aerospace, ground defense, construction and mining, oil and natural resource extraction, heavy truck, marine, rail and train, packaging, food and beverage, packaging and canning, wind, and general industrial markets through its direct sales force, as well as a network of industrial and aerospace distributors. The company was founded in 1919 and is headquartered in Oxford, Connecticut.