Head-To-Head Contrast: Immersion (NASDAQ:IMMR) and Penske Automotive Group (NYSE:PAG)

Immersion (NASDAQ:IMMR) and Penske Automotive Group (NYSE:PAG) are both consumer discretionary companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, earnings, risk, profitability and dividends.

Institutional and Insider Ownership

60.6% of Immersion shares are held by institutional investors. Comparatively, 77.1% of Penske Automotive Group shares are held by institutional investors. 10.6% of Immersion shares are held by company insiders. Comparatively, 52.9% of Penske Automotive Group shares are held by company insiders. 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.

Analyst Recommendations

This is a summary of current recommendations for Immersion and Penske Automotive Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Immersion	0	2	1	0	2.33
Penske Automotive Group	0	5	5	0	2.50

Immersion currently has a consensus price target of $13.50, indicating a potential upside of 89.61%. Penske Automotive Group has a consensus price target of $211.43, indicating a potential downside of 0.41%. Given Immersion’s higher possible upside, analysts plainly believe Immersion is more favorable than Penske Automotive Group.

Dividends

Immersion pays an annual dividend of $0.30 per share and has a dividend yield of 4.2%. Penske Automotive Group pays an annual dividend of $5.76 per share and has a dividend yield of 2.7%. Immersion pays out 88.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Penske Automotive Group pays out 42.4% of its earnings in the form of a dividend. Penske Automotive Group has increased its dividend for 6 consecutive years.

Profitability

This table compares Immersion and Penske Automotive Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Immersion	0.60%	1.83%	0.82%
Penske Automotive Group	2.81%	14.78%	4.72%

Risk and Volatility

Immersion has a beta of 1.01, suggesting that its stock price is 1% more volatile than the S&P 500. Comparatively, Penske Automotive Group has a beta of 0.92, suggesting that its stock price is 8% less volatile than the S&P 500.

Earnings & Valuation

This table compares Immersion and Penske Automotive Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Immersion	$1.73 billion	0.14	$4.52 million	$0.34	20.94
Penske Automotive Group	$31.81 billion	0.44	$935.40 million	$13.58	15.63

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

Summary

Penske Automotive Group beats Immersion on 13 of the 17 factors compared between the two stocks.

About Immersion

Immersion Corporation, together with its subsidiaries, engages in the creation, design, development, and licensing of haptic technologies that allow people to use their sense of touch to engage with and experience various digital products in North America, Europe, and Asia. The company provides technology, patent, and combined licenses. It serves markets, including mobility, gaming, automotive, virtual and augmented reality, and wearables, as well as residential, commercial, and industrial Internet of Things. The company was incorporated in 1993 and is headquartered in Aventura, Florida.

About Penske Automotive Group

Penske Automotive Group, Inc., a diversified transportation services company, operates automotive and commercial truck dealerships worldwide. The company operates through four segments: Retail Automotive, Retail Commercial Truck, Other, and Non-Automotive Investments. It operates dealerships under franchise agreements with various automotive manufacturers and distributors. The company is also involved in the sale of new and used motor vehicles, maintenance and repair services, sale and placement of third-party finance and insurance products, third-party extended service and maintenance contracts, replacement and aftermarket automotive products, collision repair services, and wholesale of parts. In addition, it operates a heavy and medium duty truck dealership, which offers Freightliner and Western Star branded trucks, as well as offers a range of used trucks. Further, it imports and distributes Western Star heavy-duty trucks, MAN heavy and medium duty trucks and buses, and Dennis Eagle refuse collection vehicles with associated parts. Additionally, the company distributes diesel and gas engines, and power systems. Penske Automotive Group, Inc. was incorporated in 1990 and is headquartered in Bloomfield Hills, Michigan.