Head to Head Review: ZTE (OTCMKTS:ZTCOY) & Assa Abloy (OTC:ASAZY)

ZTE (OTCMKTS:ZTCOY) and Assa Abloy (OTC:ASAZY) are both computer and technology companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, dividends, valuation, profitability, risk, earnings and institutional ownership.

Risk and Volatility

ZTE has a beta of 0.77, indicating that its stock price is 23% less volatile than the S&P 500. Comparatively, Assa Abloy has a beta of 1.21, indicating that its stock price is 21% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for ZTE and Assa Abloy, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ZTE	0	0	0	0	0.00
Assa Abloy	1	0	0	0	1.00

Profitability

This table compares ZTE and Assa Abloy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ZTE	5.89%	13.25%	4.04%
Assa Abloy	10.38%	15.25%	7.26%

Earnings & Valuation

This table compares ZTE and Assa Abloy”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ZTE	$17.75 billion	0.53	$1.06 billion	$0.47	8.60
Assa Abloy	$14.20 billion	2.50	$1.48 billion	$0.67	23.84

Assa Abloy has lower revenue, but higher earnings than ZTE. ZTE is trading at a lower price-to-earnings ratio than Assa Abloy, indicating that it is currently the more affordable of the two stocks.

Dividends

ZTE pays an annual dividend of $0.07 per share and has a dividend yield of 1.7%. Assa Abloy pays an annual dividend of $0.18 per share and has a dividend yield of 1.1%. ZTE pays out 14.9% of its earnings in the form of a dividend. Assa Abloy pays out 26.9% 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. ZTE is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Assa Abloy beats ZTE on 9 of the 12 factors compared between the two stocks.

About ZTE

ZTE Corporation provides integrated communication information solutions in the People's Republic of China, rest of Asia, Africa, Europe, the United States, and Oceania. It operates through three segments: Carriers' Networks, Government and Corporate Business, and Consumer Business. The Carriers' Network segment provides wireless access, wireline access, bearer systems, core networks, telecommunication software systems and services, and other technologies and product solutions for meeting carries' requirements. The Consumer Business segment offers smart phones, mobile data terminals, family terminals, and fusion terminals, as well as related software application and value-added services. The Government and Corporate Business segment focuses on providing informatization solutions for the government and corporations through the application of products, such as communications networks, Internet of Things, big data, and cloud computing. The company was founded in 1985 and is headquartered in Shenzhen, the People's Republic of China.

About Assa Abloy

ASSA ABLOY AB (publ) provides door opening and access products, solutions, and services for the institutional, commercial, and residential markets in Europe, the Middle East, India, Africa, North and South America, Asia, and Oceania. The company provides digital access solutions, such as electronic access control ecosystem, wireless solutions, electronic key solutions, standalone access solutions, and wired solutions; swing, revolving, and sliding doors; mechanical products, including hinges, lever handles, mortise lockcases, euro profile cylinders, panic exit devices, door closers, floor spring, and general hardware; and doors. It offers Openings Studio, a building information modeling software ecosystem is collaboration tool for designing, documenting, and managing openings. The company provides its products primarily under the ASSA ABLOY, Yale, and HID brands. It sells its products through distributors and wholesalers. The company serves aviation, education, distribution and logistics, entertainment and public facility, finance and banking, government and military, healthcare, hospitality, manufacturing, mining, office and enterprise, homes and residence, retail, shipyards, and transportation industries. ASSA ABLOY AB (publ) was incorporated in 1954 and is based in Stockholm, Sweden.