Critical Survey: Kion Group (OTCMKTS:KIGRY) & MSC Industrial Direct (NYSE:MSM)

Kion Group (OTCMKTS:KIGRY) and MSC Industrial Direct (NYSE:MSM) are both mid-cap industrials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, earnings, profitability, risk, analyst recommendations, valuation and dividends.

Analyst Recommendations

This is a summary of recent ratings and price targets for Kion Group and MSC Industrial Direct, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kion Group	0	0	1	2	3.67
MSC Industrial Direct	0	6	1	0	2.14

MSC Industrial Direct has a consensus price target of $91.00, indicating a potential upside of 6.74%. Given MSC Industrial Direct’s higher possible upside, analysts plainly believe MSC Industrial Direct is more favorable than Kion Group.

Insider & Institutional Ownership

79.3% of MSC Industrial Direct shares are owned by institutional investors. 18.3% of MSC Industrial Direct shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Risk and Volatility

Kion Group has a beta of 2.03, suggesting that its stock price is 103% more volatile than the S&P 500. Comparatively, MSC Industrial Direct has a beta of 0.95, suggesting that its stock price is 5% less volatile than the S&P 500.

Valuation & Earnings

This table compares Kion Group and MSC Industrial Direct”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kion Group	$12.45 billion	0.65	$389.88 million	$0.48	32.35
MSC Industrial Direct	$3.74 billion	1.27	$258.59 million	$3.54	24.08

Kion Group has higher revenue and earnings than MSC Industrial Direct. MSC Industrial Direct is trading at a lower price-to-earnings ratio than Kion Group, indicating that it is currently the more affordable of the two stocks.

Dividends

Kion Group pays an annual dividend of $0.14 per share and has a dividend yield of 0.9%. MSC Industrial Direct pays an annual dividend of $3.48 per share and has a dividend yield of 4.1%. Kion Group pays out 29.2% of its earnings in the form of a dividend. MSC Industrial Direct pays out 98.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. MSC Industrial Direct has raised its dividend for 3 consecutive years. MSC Industrial Direct is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Kion Group and MSC Industrial Direct’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kion Group	2.08%	3.89%	1.27%
MSC Industrial Direct	5.30%	14.99%	8.39%

Summary

MSC Industrial Direct beats Kion Group on 10 of the 17 factors compared between the two stocks.

About Kion Group

KION GROUP AG provides industrial trucks and supply chain solutions worldwide. The company operates in Industrial Trucks & Services and Supply Chain Solutions segments. It offers forklift trucks, counterbalance trucks with electric drive and internal combustion engine, ride-on and hand-operated warehouse trucks, automated guided vehicle systems (AGVs), and towing vehicles under the Linde, STILL, Baoli, Fenwick, and OM brands. The company also manufactures and sells spare parts; leases and rents industrial trucks and related items; and offers maintenance and repair, and fleet management services, as well as provides finance solutions. In addition, it provides integrated technology and software solutions, including automated guided vehicle systems, palletizers, storage and picking equipment, automated storage and retrieval systems, sorters, and conveyors under the Dematic brand. The company was formerly known as KION Holding 1 GmbH. KION GROUP AG was founded in 2006 and is based in Frankfurt am Main, Germany.

About MSC Industrial Direct

MSC Industrial Direct Co., Inc., together with its subsidiaries, distributes metalworking and maintenance, repair, and operations (MRO) products and services in the United States, Canada, Mexico, the United Kingdom, and internationally. The company's MRO products include cutting tools, measuring instruments, tooling components, metalworking products, fasteners, flat stock products, raw materials, abrasives, machinery hand and power tools, safety and janitorial supplies, plumbing supplies, materials handling products, power transmission components, and electrical supplies. It offers stock-keeping units through its catalogs and brochures; e-commerce channels, including its website, mscdirect.com; inventory management solutions; and customer care centers, customer fulfillment centers, regional inventory centers, and warehouses. The company serves individual machine shops, manufacturing companies, and government agencies. MSC Industrial Direct Co., Inc. was founded in 1941 and is headquartered in Melville, New York.