Hitachi Constr (OTCMKTS:HTCMY) vs. Astec Industries (NASDAQ:ASTE) Critical Survey

Astec Industries (NASDAQ:ASTE) and Hitachi Constr (OTCMKTS:HTCMY) are both industrials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, dividends, valuation, profitability and institutional ownership.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Astec Industries and Hitachi Constr, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Astec Industries	0	1	0	0	2.00
Hitachi Constr	0	0	0	0	0.00

Astec Industries currently has a consensus price target of $41.00, suggesting a potential upside of 2.45%. Given Astec Industries’ stronger consensus rating and higher probable upside, equities research analysts clearly believe Astec Industries is more favorable than Hitachi Constr.

Volatility & Risk

Astec Industries has a beta of 1.4, meaning that its stock price is 40% more volatile than the S&P 500. Comparatively, Hitachi Constr has a beta of 0.37, meaning that its stock price is 63% less volatile than the S&P 500.

Profitability

This table compares Astec Industries and Hitachi Constr’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Astec Industries	1.15%	10.72%	6.41%
Hitachi Constr	N/A	N/A	N/A

Insider & Institutional Ownership

93.2% of Astec Industries shares are owned by institutional investors. 0.7% of Astec Industries shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Astec Industries pays an annual dividend of $0.52 per share and has a dividend yield of 1.3%. Hitachi Constr pays an annual dividend of $2.29 per share and has a dividend yield of 3.7%. Astec Industries pays out 78.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Hitachi Constr pays out 42.0% of its earnings in the form of a dividend. Hitachi Constr is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings & Valuation

This table compares Astec Industries and Hitachi Constr”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Astec Industries	$1.31 billion	0.70	$4.30 million	$0.66	60.64
Hitachi Constr	$9.01 billion	0.72	$537.42 million	$5.45	11.24

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

Summary

Astec Industries beats Hitachi Constr on 9 of the 15 factors compared between the two stocks.

About Astec Industries

Astec Industries, Inc. designs, engineers, manufactures, and markets equipment and components used primarily in road building and related construction activities worldwide. The company operates in two segments, Infrastructure Solutions and Materials Solutions. The Infrastructure Solutions segment offers asphalt plants and related components, heaters, concrete dust control systems, asphalt pavers, vaporizers, concrete material handling systems, screeds, heat recovery units, paste back-fill plants, asphalt storage tanks, hot oil heaters, bagging plants, fuel storage tanks, industrial and asphalt burners and systems, custom batch plants, material transfer vehicles, soil stabilizing-reclaiming machinery, blower trucks and trailers, milling machines, soil remediation plants, wood chippers and grinders, pump trailers, concrete batch plants, control systems, liquid terminals, storage equipment and related parts, construction and retrofits, polymer plants, and concrete mixers, as well as engineering and environmental permitting services. This segment provides its products to asphalt producers; highway and heavy equipment contractors; utility contractors; sand and gravel producers; construction, demolition, recycle and crushing contractors; forestry and environmental recycling contractors; mine and quarry operators; port and inland terminal authorities; power stations; and domestic and foreign government agencies. The Materials Solutions segment designs and manufactures crushing equipment, mobile plants, bulk material handling solutions, vibrating equipment, screening equipment, electrical control centers, modular plants and systems, conveying equipment, plant automation products, portable plants, and mineral processing equipment, as well as offers consulting and engineering services. The company was incorporated in 1972 and is headquartered in Chattanooga, Tennessee.

About Hitachi Constr

Hitachi Construction Machinery Co., Ltd., together with its subsidiaries, manufactures and sells construction machineries worldwide. The company operates through two segments, Construction Machinery Business and Solution Business. It offers excavators and wheel loaders, hydraulic excavators, compaction equipment, and rigid dump trucks. The company also provides ICT construction solutions; ConSite that monitors machines' operational status and alarms by sending monthly operational reports, as well as notifies emergency alarms; Fleet management system, which offers real-time monitoring of dump truck for optimizing vehicle operations; and autonomous haulage system for autonomous operation of mining dump trucks. In addition, it provides parts and services; used equipment under the PREMIUM USED brand; machinery rental services under the PREMIUM RENTAL and REC brand names; and parts remanufacturing services. The company was incorporated in 1951 and is headquartered in Taito, Japan. Hitachi Construction Machinery Co., Ltd. is a subsidiary of Hitachi, Ltd.