Federal Signal (NYSE:FSS) and Ck Hutchison (OTCMKTS:CKHUY) Financial Analysis

Ck Hutchison (OTCMKTS:CKHUY) and Federal Signal (NYSE:FSS) are both multi-sector conglomerates companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, dividends, earnings, valuation, institutional ownership, profitability and analyst recommendations.

Risk and Volatility

Ck Hutchison has a beta of 0.46, suggesting that its share price is 54% less volatile than the S&P 500. Comparatively, Federal Signal has a beta of 1.32, suggesting that its share price is 32% more volatile than the S&P 500.

Profitability

This table compares Ck Hutchison and Federal Signal’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ck Hutchison	N/A	N/A	N/A
Federal Signal	11.22%	18.91%	12.44%

Earnings & Valuation

This table compares Ck Hutchison and Federal Signal”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ck Hutchison	$36.07 billion	0.68	$2.19 billion	N/A	N/A
Federal Signal	$1.86 billion	4.09	$216.30 million	$3.59	34.89

Ck Hutchison has higher revenue and earnings than Federal Signal.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Ck Hutchison and Federal Signal, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ck Hutchison	0	0	0	1	4.00
Federal Signal	0	3	1	0	2.25

Federal Signal has a consensus price target of $123.00, indicating a potential downside of 1.80%. Given Federal Signal’s higher probable upside, analysts plainly believe Federal Signal is more favorable than Ck Hutchison.

Institutional and Insider Ownership

92.7% of Federal Signal shares are held by institutional investors. 3.3% of Federal Signal shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Dividends

Ck Hutchison pays an annual dividend of $0.15 per share and has a dividend yield of 2.3%. Federal Signal pays an annual dividend of $0.56 per share and has a dividend yield of 0.4%. Federal Signal pays out 15.6% of its earnings in the form of a dividend. Federal Signal has raised its dividend for 3 consecutive years.

Summary

Federal Signal beats Ck Hutchison on 10 of the 16 factors compared between the two stocks.

About Ck Hutchison

CK Hutchison Holdings Limited, an investment holding company, primarily operates in ports and related services, retail, infrastructure, and telecommunications businesses in Hong Kong and internationally. The company operates through four segments: Ports and Related Services, Retail, Infrastructure, and Telecommunications. It invests in, develops, and operates ports, which operate 293 berths in 53 ports spanning 24 countries; and provides logistics and transportation-related services, such as cruise ship terminals, distribution centers, rail services, and ship repair facilities. The company also operates retail brands with stores that offer personal care, health and beauty products, food and fine wines, consumer electronics, and electrical appliances, as well as operates supermarkets under Watsons, PARKnSHOP, and FORTRESS brands; and manufactures and distributes bottled water and other beverages under the Watsons Water and Mr. Juicy brands. In addition, it invests in energy infrastructure, transportation infrastructure, water infrastructure, waste management, waste-to-energy, household infrastructure, and other infrastructure related businesses. Further, the company provides mobile telecommunications and data services, as well as operates as an integrated energy company. Additionally, it researches, develops, manufactures, commercializes, markets, and sells nutraceuticals, pharmaceuticals, and agriculture-related products; provides marine construction and ship repair yard, general engineering, and tug operations, water supply and sewerage, electricity generation and distribution, gas distribution, and aircraft maintenance services; and leases rolling stocks. The company was founded in 1828 and is based in Central, Hong Kong.

About Federal Signal

Federal Signal Corp. engages in the design and manufacture of products and integrated solutions for municipal, governmental, industrial, and commercial customers. It operates through the Environmental Solutions Group and Safety and Security Systems Group segments. The Environment Solutions Group segment is involved in the manufacture and supply of street sweeper vehicles, sewer cleaners, vacuum loader trucks, hydro-excavation trucks, and water blasting equipment. The Safety and Security Systems Group segment offers comprehensive systems and products that law enforcement, fire rescue, emergency medical services, campuses, military facilities, and industrial sites use to protect people and property. The company was founded in 1901 and is headquartered in Oak Brook, IL.