Contrasting Hitachi Constr (OTCMKTS:HTCMY) and Astec Industries (NASDAQ:ASTE)

Hitachi Constr (OTCMKTS:HTCMY) and Astec Industries (NASDAQ:ASTE) are both industrials companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, valuation, profitability, risk and dividends.

Dividends

Hitachi Constr pays an annual dividend of $2.29 per share and has a dividend yield of 3.6%. Astec Industries pays an annual dividend of $0.52 per share and has a dividend yield of 1.1%. Hitachi Constr pays out 42.0% of its earnings in the form of a dividend. Astec Industries pays out 26.1% 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.

Risk & Volatility

Hitachi Constr has a beta of 0.33, meaning that its stock price is 67% less volatile than the S&P 500. Comparatively, Astec Industries has a beta of 1.43, meaning that its stock price is 43% more volatile than the S&P 500.

Earnings and Valuation

This table compares Hitachi Constr and Astec Industries”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hitachi Constr	$9.01 billion	0.75	$537.42 million	$5.45	11.70
Astec Industries	$1.31 billion	0.80	$4.30 million	$1.99	22.98

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

Analyst Recommendations

This is a breakdown of recent recommendations for Hitachi Constr and Astec Industries, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hitachi Constr	0	0	0	0	0.00
Astec Industries	0	1	0	0	2.00

Astec Industries has a consensus target price of $41.00, suggesting a potential downside of 10.34%. Given Astec Industries’ stronger consensus rating and higher possible upside, analysts clearly believe Astec Industries is more favorable than Hitachi Constr.

Profitability

This table compares Hitachi Constr and Astec Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hitachi Constr	N/A	N/A	N/A
Astec Industries	3.50%	11.52%	7.07%

Insider and Institutional Ownership

93.2% of Astec Industries shares are owned by institutional investors. 0.7% of Astec Industries 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.

Summary

Astec Industries beats Hitachi Constr on 11 of the 15 factors compared between the two stocks.

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.

About Astec Industries

Astec Industries, Inc. designs, engineers, manufactures, and markets equipment and components used primarily in road building and related construction activities worldwide. The company operates in two segments, Infrastructure Solutions and Materials Solutions. The Infrastructure Solutions segment offers asphalt plants and related components, heaters, concrete dust control systems, asphalt pavers, vaporizers, concrete material handling systems, screeds, heat recovery units, paste back-fill plants, asphalt storage tanks, hot oil heaters, bagging plants, fuel storage tanks, industrial and asphalt burners and systems, custom batch plants, material transfer vehicles, soil stabilizing-reclaiming machinery, blower trucks and trailers, milling machines, soil remediation plants, wood chippers and grinders, pump trailers, concrete batch plants, control systems, liquid terminals, storage equipment and related parts, construction and retrofits, polymer plants, and concrete mixers, as well as engineering and environmental permitting services. This segment provides its products to asphalt producers; highway and heavy equipment contractors; utility contractors; sand and gravel producers; construction, demolition, recycle and crushing contractors; forestry and environmental recycling contractors; mine and quarry operators; port and inland terminal authorities; power stations; and domestic and foreign government agencies. The Materials Solutions segment designs and manufactures crushing equipment, mobile plants, bulk material handling solutions, vibrating equipment, screening equipment, electrical control centers, modular plants and systems, conveying equipment, plant automation products, portable plants, and mineral processing equipment, as well as offers consulting and engineering services. The company was incorporated in 1972 and is headquartered in Chattanooga, Tennessee.