Comparing China Yuchai International (NYSE:CYD) and Denso (OTCMKTS:DNZOY)

Denso (OTCMKTS:DNZOY) and China Yuchai International (NYSE:CYD) are both auto/tires/trucks companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, risk, valuation, analyst recommendations, profitability, institutional ownership and earnings.

Earnings & Valuation

This table compares Denso and China Yuchai International”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Denso	$47.03 billion	0.89	$2.77 billion	$0.95	15.17
China Yuchai International	$2.66 billion	0.44	$45.03 million	$1.62	19.07

Denso has higher revenue and earnings than China Yuchai International. Denso is trading at a lower price-to-earnings ratio than China Yuchai International, 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 Denso and China Yuchai International, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Denso	0	1	0	0	2.00
China Yuchai International	0	1	0	0	2.00

Dividends

Denso pays an annual dividend of $0.31 per share and has a dividend yield of 2.2%. China Yuchai International pays an annual dividend of $0.53 per share and has a dividend yield of 1.7%. Denso pays out 32.6% of its earnings in the form of a dividend. China Yuchai International pays out 32.7% 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. China Yuchai International has increased its dividend for 1 consecutive years. Denso is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

Denso has a beta of 1, meaning that its stock price has a similar volatility profile to the S&P 500.Comparatively, China Yuchai International has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500.

Profitability

This table compares Denso and China Yuchai International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Denso	5.62%	7.63%	4.90%
China Yuchai International	N/A	N/A	N/A

Summary

Denso beats China Yuchai International on 8 of the 12 factors compared between the two stocks.

About Denso

DENSO Corporation engages in the manufacture and sale of automotive parts in Japan, rest of Asia, North America, Europe, and internationally. The company offers air-conditioning systems, including thermal management heat pump system, heat pump air-conditioning systems, refrigerant products, personal heating and cooling devices, air quality system, heat exchangers, bus air-conditioning systems, automotive freezers, and cooling products, as well as heating, ventilation, and air-conditioning units. It also provides gasoline, diesel, hybrid, electric vehicle, and fuel cell vehicle power-train systems; and safety and cockpit systems, such as driving environment recognition, vehicle dynamic control, collision safety, visibility support, cockpit information, and information security systems, as well as other products. In addition, the company offers automotive service parts and accessories, comprising spark plugs, oil and cabin air filters, wiper blades, air filter elements, starters, alternators, compressors, oxygen sensors, fuel pumps, air conditioner service parts, radiators, condensers, ion generators, air conditioners for busses and construction vehicles, and truck refrigeration products, as well as refrigerant recovery, recycling, and charging machines; and repair and support products and services. Further, it provides industrial solutions for factories in automotive parts production; agricultural solutions, including Profarm Controller, a climate control system for greenhouse and horticulture solutions; and household air conditioning equipment and industrial systems. The company was incorporated in 1949 and is headquartered in Kariya, Japan.

About China Yuchai International

China Yuchai International Limited, through its subsidiaries, manufactures, assembles, and sells diesel and natural gas engines for trucks, buses and passenger vehicles, marine, industrial, construction, agriculture, and generator set applications in the People’s Republic of China and internationally. It operates through two segments, Yuchai and HLGE. The Yuchai segment manufactures on- and off-road powertrain solutions and applications. The HLGE is engaged in hospitality and property development activities. The company provides diesel engines comprising 4- and 6-cylinder diesel engines, high horsepower marine diesel engines, and power generator engines; natural gas engines, methanol combustion engines, diesel power generators, diesel engine parts, and remanufacturing services; as well as plug in hybrid engines, range extenders, power generation powertrains, hybrid powertrains, integrated electric drive axel powertrains, and fuel cell systems. It also offers maintenance and retrofitting services. It distributes its engines directly to auto original equipment manufacturers, agents, and retailers. The company was founded in 1951 and is based in Singapore.