Comparing Graham (GHM) & The Competition

Graham (NYSE:GHM) is one of 436 public companies in the “Machinery” industry, but how does it compare to its competitors? We will compare Graham to similar companies based on the strength of its earnings, analyst recommendations, institutional ownership, profitability, dividends, risk and valuation.

Volatility and Risk

Graham has a beta of 1.16, indicating that its stock price is 16% more volatile than the S&P 500. Comparatively, Graham’s competitors have a beta of 5.11, indicating that their average stock price is 411% more volatile than the S&P 500.

Valuation & Earnings

This table compares Graham and its competitors gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Graham	$245.29 million	$12.50 million	67.54
Graham Competitors	$4.66 billion	$364.05 million	3.53

Graham’s competitors have higher revenue and earnings than Graham. Graham is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Analyst Recommendations

This is a summary of current recommendations and price targets for Graham and its competitors, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Graham	0	2	3	0	2.60
Graham Competitors	4196	14698	18193	805	2.41

Graham currently has a consensus price target of $123.33, suggesting a potential upside of 75.59%. As a group, “Machinery” companies have a potential upside of 33.06%. Given Graham’s stronger consensus rating and higher probable upside, research analysts clearly believe Graham is more favorable than its competitors.

Profitability

This table compares Graham and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Graham	4.53%	11.09%	5.17%
Graham Competitors	-1,044.42%	-14.99%	0.57%

Institutional & Insider Ownership

69.5% of Graham shares are held by institutional investors. Comparatively, 51.7% of shares of all “Machinery” companies are held by institutional investors. 2.4% of Graham shares are held by company insiders. Comparatively, 14.2% of shares of all “Machinery” companies are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Graham beats its competitors on 8 of the 13 factors compared.

About Graham

Graham Corporation, together with its subsidiaries, designs and manufactures fluid, power, heat transfer, and vacuum equipment for chemical and petrochemical processing, defense, space, petroleum refining, cryogenic, energy, and other industries. It offers power plant systems, including ejectors and surface condensers; torpedo ejection, propulsion, and power systems, such as turbines, alternators, regulators, pumps, and blowers; and thermal management systems comprising pumps, blowers, and drive electronics for defense sector. The company also provides rocket propulsion systems consisting of turbopumps and fuel pumps; cooling systems, which include pumps, compressors, fans, and blowers; and life support systems that comprise fans, pumps, and blowers for space industry. In addition, it offers heat transfer and vacuum systems, including ejectors, process and surface condensers, liquid ring pumps, heat exchangers, and nozzles; power generation systems, such as turbines, generators, compressors, and pumps; and thermal management systems comprising pumps, blowers, and electronics for energy sector. Further, the company offers heat transfer and vacuum systems consisting of ejectors, process and surface condensers, liquid ring pumps, heat exchangers, and nozzles for chemical and petrochemical processing industry. The company also services and sells spare parts for its equipment. It sells its products directly in the United States, the Middle East, Canada, Asia, South America, and internationally. Graham Corporation was founded in 1936 and is headquartered in Batavia, New York.