Analyzing ESCO Technologies (NYSE:ESE) & Murata Manufacturing (OTCMKTS:MRAAY)

ESCO Technologies (NYSE:ESE) and Murata Manufacturing (OTCMKTS:MRAAY) are both industrials companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, risk, profitability, institutional ownership, earnings, analyst recommendations and valuation.

Dividends

ESCO Technologies pays an annual dividend of $0.32 per share and has a dividend yield of 0.2%. Murata Manufacturing pays an annual dividend of $0.14 per share and has a dividend yield of 1.6%. ESCO Technologies pays out 7.2% of its earnings in the form of a dividend. Murata Manufacturing pays out 35.9% 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.

Risk and Volatility

ESCO Technologies has a beta of 1.25, suggesting that its stock price is 25% more volatile than the S&P 500. Comparatively, Murata Manufacturing has a beta of 0.9, suggesting that its stock price is 10% less volatile than the S&P 500.

Valuation & Earnings

This table compares ESCO Technologies and Murata Manufacturing”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ESCO Technologies	$1.12 billion	4.88	$101.88 million	$4.44	47.87
Murata Manufacturing	$11.45 billion	2.90	$1.54 billion	$0.39	22.82

Murata Manufacturing has higher revenue and earnings than ESCO Technologies. Murata Manufacturing is trading at a lower price-to-earnings ratio than ESCO Technologies, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares ESCO Technologies and Murata Manufacturing’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ESCO Technologies	10.37%	11.19%	7.12%
Murata Manufacturing	12.51%	8.51%	7.28%

Institutional & Insider Ownership

95.7% of ESCO Technologies shares are owned by institutional investors. Comparatively, 0.8% of Murata Manufacturing shares are owned by institutional investors. 0.7% of ESCO Technologies shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for ESCO Technologies and Murata Manufacturing, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ESCO Technologies	0	0	2	0	3.00
Murata Manufacturing	0	0	0	0	0.00

ESCO Technologies presently has a consensus price target of $187.50, suggesting a potential downside of 11.78%. Given ESCO Technologies’ stronger consensus rating and higher possible upside, analysts clearly believe ESCO Technologies is more favorable than Murata Manufacturing.

Summary

ESCO Technologies beats Murata Manufacturing on 11 of the 16 factors compared between the two stocks.

About ESCO Technologies

ESCO Technologies Inc. produces and supplies engineered products and systems for industrial and commercial markets worldwide. It operates through three segments: Aerospace & Defense, Utility Solutions Group, and RF Test & Measurement. The Aerospace & Defense segment designs and manufactures filtration products, including hydraulic filter elements and fluid control devices used in commercial aerospace applications; filter mechanisms used in micro-propulsion devices for satellites; and custom designed filters for manned aircraft and submarines. It also designs, develops, and manufactures elastomeric-based signature reduction solutions for U.S. naval vessels; and mission-critical bushings, pins, sleeves, and precision-tolerance machined components for landing gear, rotor heads, engine mounts, flight controls, and actuation systems for the aerospace and defense industries. The Utility Solutions Group segment provides diagnostic testing solutions that enable electric power grid operators to assess the integrity of high-voltage power delivery equipment; and decision support tools for the renewable energy industry, primarily wind and solar. The RF Test & Measurement segment designs and manufactures RF test and secure communication facilities, acoustic test enclosures, RF and magnetically shielded rooms, RF measurement systems, and broadcast and recording studios; and RF absorptive materials, filters, antennas, field probes, test cells, proprietary measurement software, and other test accessories to perform various tests. The company distributes its products through a network of distributors, sales representatives, direct sales teams, and in-house sales personnel. The company was incorporated in 1990 and is based in Saint Louis, Missouri.

About Murata Manufacturing

Murata Manufacturing Co., Ltd. designs, manufactures, and sells ceramic-based passive electronic components and solutions in Japan and internationally. The company offers capacitors, inductors, noise suppression products/EMI suppression filters/ESD protection devices, resistors, thermistors, sensors, timing devices, quartz devices, sound components, power products, batteries, micro mechatronics, RFID product, baluns, couplers, filters, phase shifters, RF switches, front-end modules, SAW components, connectors, antennas, connectivity modules, wireless connectivity platforms, ionizers/active oxygen modules, and transformers. It also offers Femtet, a CAE software that solves various engineering challenges; and provides silver oxide battery. In addition, the company provides connectivity, Wifi sensing, IOT, AI, and RFID solutions. Murata Manufacturing Co., Ltd. offers its products for use in communications equipment, mobility, enterprise system, industrial, healthcare, medical, personal electronics applications, and other sectors. The company was founded in 1944 and is headquartered in Nagaokakyo, Japan.