Analyzing Hitachi Constr (OTCMKTS:HTCMY) and Terex (NYSE:TEX)

Terex (NYSE:TEX) and Hitachi Constr (OTCMKTS:HTCMY) are both mid-cap industrials companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, risk, earnings, dividends, valuation and profitability.

Earnings and Valuation

This table compares Terex and Hitachi Constr”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Terex	$5.13 billion	0.63	$335.00 million	$3.67	13.33
Hitachi Constr	$9.01 billion	0.71	$537.42 million	$5.45	11.01

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

Dividends

Terex pays an annual dividend of $0.68 per share and has a dividend yield of 1.4%. Hitachi Constr pays an annual dividend of $2.29 per share and has a dividend yield of 3.8%. Terex pays out 18.5% of its earnings in the form of a dividend. Hitachi Constr pays out 42.0% 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. Terex has increased its dividend for 5 consecutive years.

Institutional and Insider Ownership

92.9% of Terex shares are owned by institutional investors. 1.9% of Terex shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings for Terex and Hitachi Constr, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Terex	0	5	4	1	2.60
Hitachi Constr	0	0	0	0	0.00

Terex presently has a consensus target price of $51.44, suggesting a potential upside of 5.16%. Given Terex’s stronger consensus rating and higher probable upside, analysts clearly believe Terex is more favorable than Hitachi Constr.

Volatility and Risk

Terex has a beta of 1.62, suggesting that its stock price is 62% more volatile than the S&P 500. Comparatively, Hitachi Constr has a beta of 0.33, suggesting that its stock price is 67% less volatile than the S&P 500.

Profitability

This table compares Terex and Hitachi Constr’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Terex	3.46%	15.95%	5.64%
Hitachi Constr	N/A	N/A	N/A

Summary

Terex beats Hitachi Constr on 13 of the 18 factors compared between the two stocks.

About Terex

Terex Corporation manufactures and sells aerial work platforms and materials processing machinery worldwide. It operates in two segments, Materials Processing (MP) and Aerial Work Platforms (AWP). The MP segment designs, manufactures, services, and markets materials processing and specialty equipment, includes crushers, washing systems, screens, trommels, apron feeders, material handlers, pick and carry cranes, rough terrain cranes, tower cranes, wood processing, biomass and recycling equipment, concrete mixer trucks and concrete pavers, conveyors, and related components and replacement parts under the Terex, Powerscreen, Fuchs, EvoQuip, Canica, Cedarapids, CBI, Simplicity, Franna, Terex Ecotec, Finlay, ProAll, ZenRobotics, Terex Washing Systems, Terex MPS, Terex Jaques, Terex Advance, ProStack, Terex Bid-Well, MDS, and Terex Recycling Systems brands. Its products are used in construction, infrastructure, and recycling projects; quarrying and mining, and material handling applications; maintenance applications to lift equipment or material; and landscaping and biomass production industries. The AWP segment designs, manufactures, services, and markets aerial work platform equipment, utility equipment, and telehandlers under the Terex and Genie brands. Its products include portable material lifts, portable aerial work platforms, trailer-mounted articulating booms, self-propelled articulating and telescopic booms, and scissor lifts, as well as related components and replacement parts for construction and maintenance of industrial, commercial, institutional, and residential buildings and facilities, transmission and distribution lines, construction and foundation drilling applications, and other commercial operations, as well as in tree trimming and various infrastructure projects. The company offers financing solutions to assist customers in the rental, leasing, and acquisition of its products. Terex Corporation was founded in 1933 and is based in Norwalk, Connecticut.

About Hitachi Constr

Hitachi Construction Machinery Co., Ltd., together with its subsidiaries, manufactures and sells construction machineries worldwide. The company operates through two segments, Construction Machinery Business and Solution Business. It offers excavators and wheel loaders, hydraulic excavators, compaction equipment, and rigid dump trucks. The company also provides ICT construction solutions; ConSite that monitors machines' operational status and alarms by sending monthly operational reports, as well as notifies emergency alarms; Fleet management system, which offers real-time monitoring of dump truck for optimizing vehicle operations; and autonomous haulage system for autonomous operation of mining dump trucks. In addition, it provides parts and services; used equipment under the PREMIUM USED brand; machinery rental services under the PREMIUM RENTAL and REC brand names; and parts remanufacturing services. The company was incorporated in 1951 and is headquartered in Taito, Japan. Hitachi Construction Machinery Co., Ltd. is a subsidiary of Hitachi, Ltd.