Head to Head Contrast: LCI Industries (NYSE:LCII) vs. AB Volvo (OTCMKTS:VLVLY)

AB Volvo (OTCMKTS:VLVLY) and LCI Industries (NYSE:LCII) are both auto/tires/trucks companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, analyst recommendations, earnings, valuation and profitability.

Risk and Volatility

AB Volvo has a beta of 1.13, indicating that its share price is 13% more volatile than the S&P 500. Comparatively, LCI Industries has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500.

Earnings and Valuation

This table compares AB Volvo and LCI Industries”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AB Volvo	$48.98 billion	1.33	$3.52 billion	$2.04	15.70
LCI Industries	$4.12 billion	0.71	$188.25 million	$7.55	16.06

AB Volvo has higher revenue and earnings than LCI Industries. AB Volvo is trading at a lower price-to-earnings ratio than LCI Industries, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for AB Volvo and LCI Industries, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AB Volvo	2	6	0	2	2.20
LCI Industries	0	6	1	1	2.38

LCI Industries has a consensus price target of $156.67, suggesting a potential upside of 29.24%. Given LCI Industries’ stronger consensus rating and higher possible upside, analysts plainly believe LCI Industries is more favorable than AB Volvo.

Dividends

AB Volvo pays an annual dividend of $0.59 per share and has a dividend yield of 1.8%. LCI Industries pays an annual dividend of $4.60 per share and has a dividend yield of 3.8%. AB Volvo pays out 28.9% of its earnings in the form of a dividend. LCI Industries pays out 60.9% 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. LCI Industries has raised its dividend for 8 consecutive years. LCI Industries is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

0.0% of AB Volvo shares are owned by institutional investors. Comparatively, 99.7% of LCI Industries shares are owned by institutional investors. 3.5% of LCI Industries shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares AB Volvo and LCI Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
AB Volvo	8.47%	23.01%	6.14%
LCI Industries	4.57%	13.55%	5.88%

Summary

LCI Industries beats AB Volvo on 10 of the 18 factors compared between the two stocks.

About AB Volvo

AB Volvo (publ), together with its subsidiaries, manufactures and sells trucks, buses, construction equipment, and marine and industrial engines in Europe, the United States, Asia, Africa, and Oceania. The company provides heavy-duty trucks for long-haulage and construction work and light-duty trucks for distribution purposes under the Volvo, Renault Trucks, Mack, Eicher, and Dongfeng Trucks brands; and city and intercity buses, coaches, and chassis under the Prevost and Volvo Bus brands. It offers road construction machine, haulers, wheel loaders, excavators, and compact equipment. In addition, the company offers engines and power solutions for leisure and commercial vessels, as well as for power generation, industrial, and off-highway applications under the Volvo Penta brand name. Further, it provides financing, insurance, rental, spare parts, repairs, preventive maintenance, service agreement, and assistance services. The company offers its products and services through a network of dealerships and workshops. It has a strategic alliance with Isuzu Motors within commercial vehicles; a partnership with Samsung SDI Co to develop batteries for its electric products; and an agreement with Aurora to develop autonomous trucks. AB Volvo (publ) was incorporated in 1915 and is headquartered in Gothenburg, Sweden.

About LCI Industries

LCI Industries, together with its subsidiaries, manufactures and supplies engineered components for the manufacturers of recreational vehicles (RVs) and adjacent industries in the United States and internationally. It operates through two segments: Original Equipment Manufacturers (OEM) and Aftermarket. The OEM segment manufactures and distributes a range of engineered components, such as steel chassis and related components; axles, ABS, and suspension solutions; slide-out mechanisms and solutions; thermoformed bath, kitchen, and other products; vinyl, aluminum, and frameless windows; manual, electric, and hydraulic stabilizer and leveling systems; entry, luggage, patio, and ramp doors; furniture and mattresses; electric and manual entry steps; awnings and awning accessories; electronic components; appliances; air conditioners; televisions and sound systems; tankless water heaters; towing products; truck accessories; and other accessories. This segment serves OEMs of RVs and adjacent industries, including buses; trailers used to haul boats, livestock, equipment, and other cargo; trucks; boats; trains; manufactured homes; and modular housing. The Aftermarket segment supplies engineered components to aftermarket channels of the recreation and transportation markets for retail dealers, wholesale distributors, and service centers, as well as direct to retail customers through the Internet. This segment also sells replacement glass and awnings to fulfill insurance claims; and biminis, covers, buoys, fenders to the marine industry, towing products, truck accessories, appliances, air conditioners, televisions, sound systems, and tankless water heaters. The company was formerly known as Drew Industries Incorporated and changed its name to LCI Industries in December 2016. LCI Industries was founded in 1956 and is based in Elkhart, Indiana.