Comparing Orkla Asa (OTCMKTS:ORKLY) and Hitachi (OTCMKTS:HTHIY)

Orkla Asa (OTCMKTS:ORKLY) and Hitachi (OTCMKTS:HTHIY) are both large-cap industrials companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, dividends, risk, analyst recommendations, profitability, valuation and earnings.

Profitability

This table compares Orkla Asa and Hitachi’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Orkla Asa	9.91%	13.52%	7.56%
Hitachi	6.53%	10.94%	4.91%

Institutional and Insider Ownership

0.3% of Hitachi shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Orkla Asa and Hitachi”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Orkla Asa	$1.81 billion	6.04	$1.11 billion	$0.74	15.00
Hitachi	$70.33 billion	1.99	$5.30 billion	$1.06	29.08

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

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Orkla Asa and Hitachi, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Orkla Asa	1	1	0	0	1.50
Hitachi	0	1	1	1	3.00

Dividends

Orkla Asa pays an annual dividend of $0.46 per share and has a dividend yield of 4.1%. Hitachi pays an annual dividend of $0.28 per share and has a dividend yield of 0.9%. Orkla Asa pays out 62.2% of its earnings in the form of a dividend. Hitachi pays out 26.4% 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.

Volatility & Risk

Orkla Asa has a beta of 0.33, indicating that its share price is 67% less volatile than the S&P 500. Comparatively, Hitachi has a beta of 1.03, indicating that its share price is 3% more volatile than the S&P 500.

Summary

Hitachi beats Orkla Asa on 10 of the 15 factors compared between the two stocks.

About Orkla Asa

Orkla ASA is a Norwegian industrial investment company focused primarily on branded consumer goods. Its portfolio includes businesses offering food, confectionery and snacks, health and personal care products, and ingredients for food producers. The company’s brands and products serve consumers and business customers through grocery, foodservice and specialty retail channels. Orkla has a strong presence in the Nordic and Baltic countries, with operations and sales in other European markets and selected markets elsewhere.

About Hitachi

Hitachi Ltd. is a Japanese technology and industrial company that develops products, systems and services for businesses, governments and consumers. Its activities span digital services and information technology, energy systems, transportation, industrial equipment and building systems. The company supplies software, IT and systems-integration services, power-grid and energy technologies, rail vehicles and signaling systems, and industrial machinery and automation solutions. Its portfolio also includes products and services for buildings, such as elevators and escalators.