Financial Analysis: Auto Trader Group (OTCMKTS:ATDRY) versus Itochu (OTCMKTS:ITOCY)

Itochu (OTCMKTS:ITOCY) and Auto Trader Group (OTCMKTS:ATDRY) are both consumer discretionary companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, risk, profitability, institutional ownership, earnings, dividends and analyst recommendations.

Dividends

Itochu pays an annual dividend of $0.16 per share and has a dividend yield of 1.2%. Auto Trader Group pays an annual dividend of $0.04 per share and has a dividend yield of 2.2%. Itochu pays out 17.2% of its earnings in the form of a dividend.

Profitability

This table compares Itochu and Auto Trader Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Itochu	N/A	N/A	N/A
Auto Trader Group	N/A	N/A	N/A

Valuation and Earnings

This table compares Itochu and Auto Trader Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Itochu	$98.47 billion	1.06	$5.63 billion	$0.93	14.14
Auto Trader Group	$836.74 million	6.68	$393.91 million	N/A	N/A

Itochu has higher revenue and earnings than Auto Trader Group.

Risk and Volatility

Itochu has a beta of 0.63, indicating that its share price is 37% less volatile than the S&P 500. Comparatively, Auto Trader Group has a beta of 1.11, indicating that its share price is 11% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Itochu and Auto Trader Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Itochu	0	1	1	2	3.25
Auto Trader Group	1	4	1	0	2.00

Insider and Institutional Ownership

0.1% of Itochu shares are held by institutional investors. Comparatively, 0.0% of Auto Trader Group shares are held by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Itochu beats Auto Trader Group on 5 of the 9 factors compared between the two stocks.

About Itochu

ITOCHU Corporation engages in trading and importing/exporting various products worldwide. The company’s Textile segment produces and sells raw materials, threads, and textiles; and garments, home furnishings, and industrial materials, as well as trades in industrial textile and lifestyle products. Its Machinery segment engages in the plants, bridges, railways, and other infrastructure; power generation, transmission, transformation, and sale; water, environment and waste-related; ship trading; renewable and alternative energy; and waste recycling businesses. The company’s Metals & Minerals segment engages in development of metal and mineral resource; processing and steel products; trading of iron ore, coal, pig iron and ferrous raw materials, non-ferrous and light metals, steel products, nuclear fuels, and greenhouse gas emissions; and recycling and waste treatment activities. Its Energy & Chemicals segment trades in crude oil, petroleum products, LPG, LNG, natural gas, hydrogen, organic and inorganic chemicals, functional food, synthetic resins, packaging materials, household goods, fine chemicals, pharmaceuticals, and electronic materials, as well as engages in the solar and biomass power generation, electricity trading, and the energy storage cell businesses. The company’s Food segment produces, distributes, and retails food products. Its General Products & Realty segment produces and sells paper, pulp, natural rubber, tire, and wood products and materials; develops and operates real estate properties, such as housing, logistics facilities, and other projects; and offers logistics services. The company’s ICT & Financial Business segment offers IT, Internet related and venture capital, mobile telephone equipment, BPO, broadcasting and communications, entertainment and content, healthcare and preventive medicine outsourcing, and financial and insurance brokerage services. The company was founded in 1858 and is headquartered in Tokyo, Japan.

About Auto Trader Group

Auto Trader Group plc operates in the digital automotive marketplace in the United Kingdom and Ireland. The company provides vehicle advertisement on its websites for private sellers, as well as insurance and loan financing products to consumers; and display advertising on its websites for manufacturers and their advertising agencies. The company offers its products to retailers, home traders, and logistics firms. Auto Trader Group plc was founded in 1977 and is headquartered in Manchester, the United Kingdom.