Contrasting Enersys (NYSE:ENS) and Rockwell Automation (NYSE:ROK)

Enersys (NYSE:ENS) and Rockwell Automation (NYSE:ROK) are both industrials companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, profitability, risk, earnings, institutional ownership, analyst recommendations and dividends.

Dividends

Enersys pays an annual dividend of $1.15 per share and has a dividend yield of 0.8%. Rockwell Automation pays an annual dividend of $5.52 per share and has a dividend yield of 1.4%. Enersys pays out 12.3% of its earnings in the form of a dividend. Rockwell Automation pays out 51.7% 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. Enersys has raised its dividend for 2 consecutive years and Rockwell Automation has raised its dividend for 15 consecutive years. Rockwell Automation is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

94.9% of Enersys shares are owned by institutional investors. Comparatively, 75.7% of Rockwell Automation shares are owned by institutional investors. 1.1% of Enersys shares are owned by company insiders. Comparatively, 0.8% of Rockwell Automation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings and target prices for Enersys and Rockwell Automation, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Enersys	0	1	5	0	2.83
Rockwell Automation	0	13	9	0	2.41

Enersys presently has a consensus price target of $265.00, indicating a potential upside of 82.59%. Rockwell Automation has a consensus price target of $468.00, indicating a potential upside of 18.66%. Given Enersys’ stronger consensus rating and higher possible upside, analysts clearly believe Enersys is more favorable than Rockwell Automation.

Volatility and Risk

Enersys has a beta of 1.21, meaning that its stock price is 21% more volatile than the S&P 500. Comparatively, Rockwell Automation has a beta of 1.51, meaning that its stock price is 51% more volatile than the S&P 500.

Valuation and Earnings

This table compares Enersys and Rockwell Automation”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Enersys	$3.75 billion	1.40	$293.56 million	$9.34	15.54
Rockwell Automation	$8.34 billion	5.25	$869.00 million	$10.67	36.96

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

Profitability

This table compares Enersys and Rockwell Automation’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Enersys	9.29%	24.02%	11.42%
Rockwell Automation	13.39%	39.83%	12.97%

Summary

Rockwell Automation beats Enersys on 12 of the 17 factors compared between the two stocks.

About Enersys

EnerSys engages in the provision of stored energy solutions for industrial applications worldwide. It operates in four segments: Energy Systems, Motive Power, Specialty, and New Ventures. The Energy Systems segment offers uninterruptible power systems (UPS) applications for computer and computer-controlled systems, as well as telecommunications systems; switchgear and electrical control systems used in industrial facilities and electric utilities, large-scale energy storage, and energy pipelines; integrated power solutions and services to broadband, telecom, data center, and renewable and industrial customers; and thermally managed cabinets and enclosures for electronic equipment and batteries. The Motive Power segment provides power solutions for electric industrial forklifts used in manufacturing, warehousing, and other material handling applications, as well as automated guided vehicles, mining equipment, and diesel locomotive starting and other rail equipment. The Specialty offers batteries for starting, lighting, and ignition applications in automotive and over-the-road trucks; and energy solutions for satellites, spacecraft, commercial aircraft, military land vehicles, aircraft, submarines, ships, and other tactical vehicles, as well as medical devices and equipment. The New Venture segment provides energy storage and management systems for demand charge reduction, utility back-up power, and dynamic fast charging for electric vehicles. The company also offers battery chargers, power equipment, battery accessories, and outdoor cabinet enclosures, as well as related after-market and customer-support services for industrial batteries. It sells its products through a network of distributors, independent representatives, and internal sales forces. The company was formerly known as Yuasa, Inc. and changed its name to EnerSys in January 2001. EnerSys was founded in 1991 and is headquartered in Reading, Pennsylvania.

About Rockwell Automation

Rockwell Automation, Inc. provides industrial automation and digital transformation solutions in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. The company operates through three segments, Intelligent Devices, Software & Control, and Lifecycle Services. Its solutions include hardware and software products and services. The Intelligent Devices segment offers drives, motion, safety, sensing, industrial components, and configured-to-order products. The Software & Control segment provides control and visualization software and hardware, information software, and network and security infrastructure solutions. The Lifecycle Services segment provides consulting, professional services and solutions, and connected and maintenance services. The company sells its solutions primarily through independent distributors in relation with its direct sales force. It serves discrete end markets, including automotive, semiconductor, and warehousing and logistics, as well as general industries comprising printing and publishing, marine, glass, fiber and textiles, airports, and aerospace; hybrid end markets, such as food and beverage, life sciences, household and personal care, and tire, as well as eco industrial, including water/wastewater, waste management, mass transit, and renewable energy; and process end markets comprising oil and gas, mining, metals, chemicals, pulp and paper, and others. Rockwell Automation, Inc. was founded in 1903 and is headquartered in Milwaukee, Wisconsin.