SPX Corp (NASDAQ: SPXC) and Snap-on (NYSE:SNA) are both industrial machinery & equipment – nec companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, institutional ownership, dividends, earnings, profitability, analyst recommendations and risk.

Valuation and Earnings

This table compares SPX Corp and Snap-on’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
SPX Corp N/A N/A N/A $0.77 39.71
Snap-on $3.43 billion 2.59 $546.40 million $9.75 15.99

Snap-on has higher revenue and earnings than SPX Corp. Snap-on is trading at a lower price-to-earnings ratio than SPX Corp, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

95.0% of Snap-on shares are owned by institutional investors. 3.7% of Snap-on shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Dividends

Snap-on pays an annual dividend of $2.84 per share and has a dividend yield of 1.8%. SPX Corp does not pay a dividend. Snap-on pays out 29.1% of its earnings in the form of a dividend. SPX Corp has raised its dividend for 7 consecutive years.

Profitability

This table compares SPX Corp and Snap-on’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SPX Corp -2.37% -15.86% -1.74%
Snap-on 13.91% 18.52% 10.62%

Analyst Ratings

This is a breakdown of recent ratings and target prices for SPX Corp and Snap-on, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SPX Corp 0 0 0 0 N/A
Snap-on 0 2 7 0 2.78

Snap-on has a consensus target price of $192.00, indicating a potential upside of 23.18%. Given Snap-on’s higher possible upside, analysts plainly believe Snap-on is more favorable than SPX Corp.

Risk & Volatility

SPX Corp has a beta of 1.73, suggesting that its share price is 73% more volatile than the S&P 500. Comparatively, Snap-on has a beta of 1.12, suggesting that its share price is 12% more volatile than the S&P 500.

Summary

Snap-on beats SPX Corp on 10 of the 13 factors compared between the two stocks.

SPX Corp Company Profile

SPX Corporation is a global supplier of infrastructure equipment. The Company operates through three segments: HVAC; Detection and Measurement, and Engineered Solutions. The HVAC solutions offered by its businesses include package cooling towers, residential and commercial boilers, heating and ventilation products. Its detection and measurement product lines encompass underground pipe and cable locators, and inspection equipment. Within its power platform, it is a manufacturer of medium and large power transformers, as well as equipment for various types of power plant, including cooling equipment, heat exchangers and pollution control systems. As of December 31, 2016, the Company had operations in approximately 15 countries.

Snap-on Company Profile

Snap-on Incorporated is a manufacturer and marketer of tools, equipment, diagnostics, repair information and systems solutions. The Company’s segments include the Commercial & Industrial Group, the Snap-on Tools Group, the Repair Systems & Information Group, and Financial Services. The Commercial & Industrial Group consists of business operations serving a range of industrial and commercial customers, including customers in the aerospace, natural resources, government, power generation, transportation and technical education markets. The Snap-on Tools Group consists of business operations primarily serving vehicle service and repair technicians. The Repair Systems & Information Group consists of business operations serving other professional vehicle repair customers, primarily owners and managers of independent repair shops and original equipment manufacturer (OEM) dealership service and repair shops. Financial Services consists of the business operations of its finance subsidiaries.

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