Contrasting Denso (OTCMKTS:DNZOY) and Aptiv (NYSE:APTV)

Denso (OTCMKTS:DNZOY) and Aptiv (NYSE:APTV) are both large-cap auto/tires/trucks companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, institutional ownership, profitability, risk, valuation and earnings.

Institutional and Insider Ownership

94.2% of Aptiv shares are owned by institutional investors. 0.5% of Aptiv shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Denso and Aptiv’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Denso	4.92%	6.84%	4.34%
Aptiv	1.46%	18.51%	7.38%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Denso and Aptiv, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Denso	1	2	0	0	1.67
Aptiv	0	7	14	4	2.88

Aptiv has a consensus target price of $96.63, indicating a potential upside of 22.29%. Given Aptiv’s stronger consensus rating and higher probable upside, analysts clearly believe Aptiv is more favorable than Denso.

Valuation & Earnings

This table compares Denso and Aptiv”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Denso	$47.03 billion	0.84	$2.77 billion	$0.86	15.78
Aptiv	$19.71 billion	0.87	$1.79 billion	$1.26	62.71

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

Volatility and Risk

Denso has a beta of 1.12, suggesting that its share price is 12% more volatile than the S&P 500. Comparatively, Aptiv has a beta of 1.51, suggesting that its share price is 51% more volatile than the S&P 500.

Summary

Aptiv beats Denso on 12 of the 15 factors compared between the two stocks.

About Denso

DENSO Corporation engages in the manufacture and sale of automotive parts in Japan, rest of Asia, North America, Europe, and internationally. The company offers air-conditioning systems, including thermal management heat pump system, heat pump air-conditioning systems, refrigerant products, personal heating and cooling devices, air quality system, heat exchangers, bus air-conditioning systems, automotive freezers, and cooling products, as well as heating, ventilation, and air-conditioning units. It also provides gasoline, diesel, hybrid, electric vehicle, and fuel cell vehicle power-train systems; and safety and cockpit systems, such as driving environment recognition, vehicle dynamic control, collision safety, visibility support, cockpit information, and information security systems, as well as other products. In addition, the company offers automotive service parts and accessories, comprising spark plugs, oil and cabin air filters, wiper blades, air filter elements, starters, alternators, compressors, oxygen sensors, fuel pumps, air conditioner service parts, radiators, condensers, ion generators, air conditioners for busses and construction vehicles, and truck refrigeration products, as well as refrigerant recovery, recycling, and charging machines; and repair and support products and services. Further, it provides industrial solutions for factories in automotive parts production; agricultural solutions, including Profarm Controller, a climate control system for greenhouse and horticulture solutions; and household air conditioning equipment and industrial systems. The company was incorporated in 1949 and is headquartered in Kariya, Japan.

About Aptiv

Aptiv PLC engages in design, manufacture, and sale of vehicle components in North America, Europe, Middle East, Africa, the Asia Pacific, South America, and internationally. The company provides electrical, electronic, and safety technology solutions to the automotive and commercial vehicle markets. It operates through two segments, Signal and Power Solutions, and Advanced Safety and User Experience. The Signal and Power Solutions segment designs, manufactures, and assembles vehicle’s electrical architecture, including engineered component products, connectors, wiring assemblies and harnesses, cable management products, electrical centers, and hybrid high voltage and safety distribution systems. Its Advanced Safety and User Experience segment provides critical technologies and services for vehicle safety, security, comfort, and convenience, such as sensing and perception systems, electronic control units, multi-domain controllers, vehicle connectivity systems, application software, autonomous driving technologies, and end-to-end DevOps tools. The company was formerly known as Delphi Automotive PLC and changed its name to Aptiv PLC in December 2017. Aptiv PLC was incorporated in 2011 and is based in Dublin, Ireland.