Barloworld (OTCMKTS:BRRAY) & Federal Signal (NYSE:FSS) Financial Comparison

Federal Signal (NYSE:FSS) and Barloworld (OTCMKTS:BRRAY) are both mid-cap multi-sector conglomerates companies, but which is the superior stock? We will compare the two businesses based on the strength of their dividends, risk, valuation, earnings, analyst recommendations, institutional ownership and profitability.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Federal Signal and Barloworld, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Federal Signal	0	4	2	0	2.33
Barloworld	0	0	0	0	0.00

Federal Signal presently has a consensus target price of $123.00, indicating a potential upside of 13.73%. Given Federal Signal’s stronger consensus rating and higher probable upside, equities analysts plainly believe Federal Signal is more favorable than Barloworld.

Dividends

Federal Signal pays an annual dividend of $0.56 per share and has a dividend yield of 0.5%. Barloworld pays an annual dividend of $0.08 per share and has a dividend yield of 0.5%. Federal Signal pays out 14.6% of its earnings in the form of a dividend. Federal Signal has increased its dividend for 3 consecutive years. Federal Signal is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Federal Signal and Barloworld”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Federal Signal	$1.86 billion	3.53	$216.30 million	$3.83	28.24
Barloworld	$2.09 billion	1.41	$79.96 million	N/A	N/A

Federal Signal has higher earnings, but lower revenue than Barloworld.

Volatility and Risk

Federal Signal has a beta of 1.35, suggesting that its share price is 35% more volatile than the S&P 500. Comparatively, Barloworld has a beta of -0.29, suggesting that its share price is 129% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Federal Signal	11.47%	19.50%	12.93%
Barloworld	N/A	N/A	N/A

Institutional and Insider Ownership

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

Summary

Federal Signal beats Barloworld on 13 of the 15 factors compared between the two stocks.

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.

About Barloworld

Barloworld Limited operates as an industrial processing, distribution, and services company in Southern Africa, Australia, Russia, and Mongolia. The company operates through Equipment Southern Africa, Automotive, Ingrain, Equipment Eurasia, and Other segments. The company offers industrial equipment and services comprising of earthmoving equipment, industrial services, and power systems that enable various mining, construction, and power solutions. It also manufactures various products, which includes food, beverages, paper, pharmaceuticals, building material and adhesives, and others. In addition, the company offers starch, glucose, and other products; and salvage management and disposal services. It serves mining, construction, energy, and transportation sectors. The company was founded in 1902 and is based in Sandton, South Africa.