Delphi Automotive PLC (NYSE: DLPH) and Autoliv (NYSE:ALV) are both large-cap auto, truck & motorcycle parts – nec companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, risk, profitability, earnings, institutional ownership and dividends.

Institutional and Insider Ownership

90.0% of Delphi Automotive PLC shares are held by institutional investors. Comparatively, 32.6% of Autoliv shares are held by institutional investors. 0.3% of Delphi Automotive PLC shares are held by company insiders. Comparatively, 0.3% of Autoliv shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and price targets for Delphi Automotive PLC and Autoliv, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Delphi Automotive PLC 1 4 13 0 2.67
Autoliv 4 10 7 0 2.14

Delphi Automotive PLC currently has a consensus target price of $105.24, suggesting a potential upside of 8.61%. Autoliv has a consensus target price of $112.05, suggesting a potential downside of 10.84%. Given Delphi Automotive PLC’s stronger consensus rating and higher possible upside, equities analysts clearly believe Delphi Automotive PLC is more favorable than Autoliv.

Dividends

Delphi Automotive PLC pays an annual dividend of $1.16 per share and has a dividend yield of 1.2%. Autoliv pays an annual dividend of $2.40 per share and has a dividend yield of 1.9%. Delphi Automotive PLC pays out 22.6% of its earnings in the form of a dividend. Autoliv pays out 41.4% 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. Autoliv has raised its dividend for 7 consecutive years. Autoliv is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Delphi Automotive PLC and Autoliv’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Delphi Automotive PLC 8.00% 57.92% 14.04%
Autoliv 4.96% 13.42% 6.50%

Volatility and Risk

Delphi Automotive PLC has a beta of 1.37, meaning that its share price is 37% more volatile than the S&P 500. Comparatively, Autoliv has a beta of 1.1, meaning that its share price is 10% more volatile than the S&P 500.

Earnings & Valuation

This table compares Delphi Automotive PLC and Autoliv’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Delphi Automotive PLC $16.66 billion 1.55 $1.26 billion $5.13 18.89
Autoliv $10.07 billion 1.08 $567.10 million $5.80 21.67

Delphi Automotive PLC has higher revenue and earnings than Autoliv. Delphi Automotive PLC is trading at a lower price-to-earnings ratio than Autoliv, indicating that it is currently the more affordable of the two stocks.

Summary

Delphi Automotive PLC beats Autoliv on 13 of the 17 factors compared between the two stocks.

About Delphi Automotive PLC

Delphi Automotive PLC is a global technology company serving the automotive sector. The Company designs and manufactures vehicle components, and provides electrical and electronic, powertrain and active safety technology solutions to the global automotive and commercial vehicle markets. The Company’s segments include Electrical/Electronic Architecture, Powertrain Systems, and Electronics and Safety. The Electrical/Electronic Architecture segment provides complete design of the vehicle’s electrical architecture, including connectors, wiring assemblies and harnesses, electrical centers and hybrid high voltage and safety distribution systems. The Powertrain Systems segment offers products for engine management systems (EMS). The Electronics and Safety segment offers a range of electronic and safety equipment and software in the areas of controls, security, infotainment, communications and safety systems.

About Autoliv

Autoliv, Inc. is a supplier of automotive safety systems with a range of product offerings, including passive safety systems and active safety systems. The Company operates through two segments: Passive Safety and Electronics. The Passive safety products include modules and components for passenger and driver-side airbags, side-impact airbag protection systems, seatbelts, steering wheels, inflator technologies, whiplash protection systems and child seats, and components for such systems, as well as passive safety electronic products, such as restraint electronics and crash sensors. The Active safety products include camera-based vision systems, night driving assist, automotive radars, brake controls, positioning systems, electronic control units, and other active safety systems. As of December 31, 2016, including joint venture operations, the Company had approximately 78 production facilities in 25 countries, consisting of both component factories and assembly factories.

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