Analyzing AB Volvo (OTCMKTS:VLVLY) & Wabash National (NYSE:WNC)

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

Volatility & Risk

AB Volvo has a beta of 1.13, suggesting that its stock price is 13% more volatile than the S&P 500. Comparatively, Wabash National has a beta of 1.66, suggesting that its stock price is 66% more volatile than the S&P 500.

Earnings & Valuation

This table compares AB Volvo and Wabash National”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AB Volvo	$48.98 billion	1.50	$3.52 billion	$2.04	17.69
Wabash National	$1.54 billion	0.24	$211.45 million	$4.87	1.86

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

Dividends

AB Volvo pays an annual dividend of $0.68 per share and has a dividend yield of 1.9%. Wabash National pays an annual dividend of $0.32 per share and has a dividend yield of 3.5%. AB Volvo pays out 33.3% of its earnings in the form of a dividend. Wabash National pays out 6.6% 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. Wabash National is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider and Institutional Ownership

0.0% of AB Volvo shares are owned by institutional investors. Comparatively, 97.1% of Wabash National shares are owned by institutional investors. 1.8% of Wabash National shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares AB Volvo and Wabash National’s 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%
Wabash National	13.71%	-22.79%	-6.77%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for AB Volvo and Wabash National, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AB Volvo	2	6	0	2	2.20
Wabash National	1	2	0	0	1.67

Wabash National has a consensus price target of $10.00, suggesting a potential upside of 10.39%. Given Wabash National’s higher probable upside, analysts plainly believe Wabash National is more favorable than AB Volvo.

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 Wabash National

Wabash National Corporation provides connected solutions for the transportation, logistics, and distribution industries primarily in the United States. The company operates through two segments, Transportation Solutions and Parts & Services. The Transportation Solutions segment designs and manufactures transportation-related equipment and products dry and refrigerated van trailers, platform trailers, tank trailers, and truck-mounted tanks; truck bodies for dry-freight transportation; cargo and cargo XL bodies for commercial applications; refrigerated truck bodies; platform truck bodies; and used trailers, as well as laminated hardwood oak flooring products. The Parts & Services segment provides aftermarket parts and services; steel flatbed bodies, truck body mounting, shelving for package delivery, partitions, roof racks, hitches, liftgates, thermal solutions, and others; truck body repair parts; and door repair and replacement, collision repair, and basic maintenance services. It also develops and scales a digital marketplace for the transportation and logistics distribution industry; operates a parts and services distribution platform; and stainless steel storage tanks and silos, mixers, and processors for the dairy, food and beverage, pharmaceutical, chemical, craft brewing, and biotech markets; trailers as a service; and composite products, including truck bodies, overhead doors, and other industrial application products, as well as used trailers. The company offers its products under the Wabash, DuraPlate, DuraPlateHD, DuraPlate AeroSkirt, and AeroSkirt CX brands, as well as EcoNex brand. It serves its products to truckload common carriers, leasing companies, private fleet carriers, less-than-truckload common carriers, and package carriers. Wabash National Corporation was founded in 1985 and is headquartered in Lafayette, Indiana.