Financial Analysis: Taylor Devices (NASDAQ:TAYD) vs. Hydrofarm Holdings Group (NASDAQ:HYFM)

Taylor Devices (NASDAQ:TAYD) and Hydrofarm Holdings Group (NASDAQ:HYFM) are both small-cap industrials companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, valuation, analyst recommendations, earnings, institutional ownership, risk and dividends.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Taylor Devices and Hydrofarm Holdings Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Taylor Devices	0	3	0	1	2.50
Hydrofarm Holdings Group	1	0	0	0	1.00

Taylor Devices currently has a consensus target price of $65.00, indicating a potential upside of 14.98%. Given Taylor Devices’ stronger consensus rating and higher probable upside, research analysts plainly believe Taylor Devices is more favorable than Hydrofarm Holdings Group.

Risk & Volatility

Taylor Devices has a beta of 0.94, suggesting that its stock price is 6% less volatile than the S&P 500. Comparatively, Hydrofarm Holdings Group has a beta of 2.39, suggesting that its stock price is 139% more volatile than the S&P 500.

Institutional & Insider Ownership

17.6% of Taylor Devices shares are held by institutional investors. Comparatively, 26.6% of Hydrofarm Holdings Group shares are held by institutional investors. 7.7% of Taylor Devices shares are held by company insiders. Comparatively, 14.9% of Hydrofarm Holdings Group shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Taylor Devices and Hydrofarm Holdings Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Taylor Devices	17.50%	9.64%	8.90%
Hydrofarm Holdings Group	-267.20%	-500.33%	-159.25%

Earnings and Valuation

This table compares Taylor Devices and Hydrofarm Holdings Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Taylor Devices	$41.65 million	4.38	$8.56 million	$2.07	27.31
Hydrofarm Holdings Group	$106.21 million	0.03	-$289.79 million	($60.70)	-0.01

Taylor Devices has higher earnings, but lower revenue than Hydrofarm Holdings Group. Hydrofarm Holdings Group is trading at a lower price-to-earnings ratio than Taylor Devices, indicating that it is currently the more affordable of the two stocks.

Summary

Taylor Devices beats Hydrofarm Holdings Group on 10 of the 14 factors compared between the two stocks.

About Taylor Devices

Taylor Devices, Inc. engages in design, development, manufacture, and marketing of shock absorption, rate control, and energy storage devices for use in machinery, equipment, and structures in the United States, Asia, and internationally. Its products include seismic dampers that are designed to mitigate the effects of earthquakes on structures; Fluidicshoks, which are compact shock absorbers primarily used in defense, aerospace, and commercial industries; and crane and industrial buffers, which are larger versions of the Fluidicshoks for industrial application on cranes and crane trolleys, truck docks, ladle and ingot cars, ore trolleys, and train car stops. The company's products also comprise self-adjusting shock absorbers that include versions of Fluidicshoks, and crane and industrial buffers, which automatically adjust to various impact conditions and are designed for high cycle application primarily in the heavy industry; liquid die springs that are used as component parts of machinery and equipment used in the manufacture of tools and dies; vibration dampers, which are primarily used by aerospace and defense industries to control the response of electronics and optical systems subjected to air, ship, or spacecraft vibration; machined springs used in the aerospace applications; and custom actuators for special aerospace and defense applications. It markets its products through a network of sales representatives and distributors. The company was incorporated in 1955 and is headquartered in North Tonawanda, New York.

About Hydrofarm Holdings Group

Hydrofarm Holdings Group, Inc., together with its subsidiaries, manufactures and distributes controlled environment agriculture (CEA) equipment and supplies in the United States and Canada. The company provides agricultural lighting devices, indoor climate control equipment, and nutrients, as well as plant additives used to grow, farm, and cultivate cannabis, flowers, fruits, plants, vegetables, grains, and herbs in controlled environment. It is also involved in the distribution of CEA equipment and supplies comprising nutrients and fertilizers; grow light systems; horticulture benches and racking systems; heating, ventilation, and air conditioning systems; humidity and carbon dioxide monitors and controllers; water pumps, heaters, chillers, and filters; and various growing media typically made from soil, peat, rock wool or coconut fiber, and others. The company offers its products to specialty hydroponic retailers, commercial resellers and greenhouse builders, garden centers, hardware stores, and e-commerce retailers under the Active Air, Active Aqua, Aurora Peat Products, HEAVY 16, House & Garden, Gaia Green, Grotek, Innovative Growers Equipment, Mad Farmer, Phantom, PHOTOBIO, Procision, Roots Organics, Soul, and SunBlaster brands. It serves its products through a range of commercial and home gardening equipment and supplies retailers. Hydrofarm Holdings Group, Inc. was founded in 1977 and is based in Shoemakersville, Pennsylvania.