Dover Corporation (NYSE: DOV) and Actuant (NYSE:ATU) are both industrial products companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, valuation, profitability, analyst recommendations, dividends, earnings and institutional ownership.

Analyst Recommendations

This is a summary of current ratings and price targets for Dover Corporation and Actuant, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Dover Corporation 0 9 6 0 2.40
Actuant 0 8 4 0 2.33

Dover Corporation presently has a consensus price target of $86.67, indicating a potential upside of 3.35%. Actuant has a consensus price target of $26.25, indicating a potential upside of 14.13%. Given Actuant’s higher probable upside, analysts clearly believe Actuant is more favorable than Dover Corporation.

Dividends

Dover Corporation pays an annual dividend of $1.76 per share and has a dividend yield of 2.1%. Actuant pays an annual dividend of $0.04 per share and has a dividend yield of 0.2%. Dover Corporation pays out 44.1% of its earnings in the form of a dividend. Actuant pays out 4.9% 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. Dover Corporation has raised its dividend for 61 consecutive years. Dover Corporation is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings & Valuation

This table compares Dover Corporation and Actuant’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Dover Corporation $7.29 billion 1.79 $1.22 billion $3.99 21.02
Actuant $1.10 billion 1.25 $135.13 million $0.82 28.05

Dover Corporation has higher revenue and earnings than Actuant. Dover Corporation is trading at a lower price-to-earnings ratio than Actuant, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

85.7% of Dover Corporation shares are owned by institutional investors. 2.5% of Dover Corporation shares are owned by insiders. Comparatively, 4.0% of Actuant shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Dover Corporation and Actuant’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Dover Corporation 8.61% 13.36% 5.22%
Actuant 7.62% 16.47% 6.19%

Risk & Volatility

Dover Corporation has a beta of 1.27, meaning that its share price is 27% more volatile than the S&P 500. Comparatively, Actuant has a beta of 1.61, meaning that its share price is 61% more volatile than the S&P 500.

Summary

Dover Corporation beats Actuant on 10 of the 17 factors compared between the two stocks.

About Dover Corporation

Dover Corporation is a diversified global manufacturer delivering equipment and components, specialty systems, consumable supplies, software and digital solutions and support services. The Company’s segments include Energy, Engineered Systems, Fluids and Refrigeration & Food Equipment. The Company’s Energy segment is a provider of solutions and services for production and processing of fuels around the world. Its Engineered Systems segment includes two platforms: Printing & Identification, and Industrials and is focused on the design, manufacture and service of critical equipment and components serving the fast-moving consumer goods, digital textile printing and industrial end markets. Its Fluids segment is focused on the safe handling of critical fluids across the retail fueling, chemical, and industrial end markets. The Refrigeration & Food Equipment segment is a provider of energy efficient equipment and systems serving the commercial refrigeration and food equipment end markets.

About Actuant

Actuant Corporation designs, manufactures and distributes a range of industrial products and systems to various end markets. The Company operates through three segments: Industrial, Energy and Engineered Solutions. The Company’s Industrial segment is primarily involved in the design, manufacture and distribution of branded hydraulic and mechanical tools to the maintenance, industrial, infrastructure and production automation markets. The Company’s Energy segment provides joint integrity products and services, customized offshore vessel mooring solutions, as well as rope and cable solutions to the global oil and gas, power generation and other energy markets. The Company’s Engineered Solutions segment provides engineered position and motion control systems to original equipment manufacturers (OEM) in various on and off-highway vehicle markets, as well as various other products to the industrial and agricultural markets.

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