Analyzing Magna International (NYSE:MGA) & IOCHPE MAXION S/S (NYSE:IOCJY)

Magna International (NYSE:MGA) and IOCHPE MAXION S/S (OTCMKTS:IOCJY) are both auto/tires/trucks companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, profitability, analyst recommendations, dividends, risk, valuation and institutional ownership.

Dividends

Magna International pays an annual dividend of $1.46 per share and has a dividend yield of 2.7%. IOCHPE MAXION S/S pays an annual dividend of $0.03 per share and has a dividend yield of 2.0%. Magna International pays out 21.8% of its earnings in the form of a dividend. IOCHPE MAXION S/S pays out 25.0% 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. Magna International is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider and Institutional Ownership

56.7% of Magna International shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Magna International and IOCHPE MAXION S/S’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Magna International 4.43% 17.59% 7.49%
IOCHPE MAXION S/S 3.36% 7.92% 2.78%

Analyst Recommendations

This is a breakdown of recent recommendations for Magna International and IOCHPE MAXION S/S, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Magna International 1 7 4 0 2.25
IOCHPE MAXION S/S 0 0 0 0 N/A

Magna International presently has a consensus price target of $55.00, suggesting a potential upside of 2.25%. Given Magna International’s higher possible upside, research analysts plainly believe Magna International is more favorable than IOCHPE MAXION S/S.

Volatility and Risk

Magna International has a beta of 1.55, suggesting that its stock price is 55% more volatile than the S&P 500. Comparatively, IOCHPE MAXION S/S has a beta of 0.95, suggesting that its stock price is 5% less volatile than the S&P 500.

Earnings and Valuation

This table compares Magna International and IOCHPE MAXION S/S’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Magna International $40.83 billion 0.40 $2.30 billion $6.71 8.02
IOCHPE MAXION S/S $2.65 billion 0.26 $55.08 million $0.12 12.75

Magna International has higher revenue and earnings than IOCHPE MAXION S/S. Magna International is trading at a lower price-to-earnings ratio than IOCHPE MAXION S/S, indicating that it is currently the more affordable of the two stocks.

Summary

Magna International beats IOCHPE MAXION S/S on 13 of the 14 factors compared between the two stocks.

About Magna International

Magna International Inc. designs, develops, and manufactures automotive systems, assemblies, modules, and components in North America, Europe, Asia Pacific, and internationally. The Body Exteriors & Structures segment provides body structures; chassis structures, such as frame and structural assemblies, chassis subframes, and suspension systems; exterior systems and modules, including hoods, roofs, door panels, front end modules, liftgate modules, polycarbonate roof panels, liftgate sensor integration systems, and fascia; trim and automotive jewelry comprises engineered glass, trim and roof racks, and running boards; non-visible and visible active grille shutters, active air deflectors, and underbody panels; and fuel systems, pipes and components, and alternative energy storage systems. Its Power & Vision segment offers manual, hybrid, and dual-clutch transmissions systems; mild hybrid solutions; high voltage edrives and electrified components; chassis, glow plug control, powertrain control, and mechatronic control modules; four-wheel drive, all-wheel drive, and disconnect systems; thermal management and lubrication systems; transmission clutch/carrier components, precision stampings and shafts, and automated driving systems; latching systems, door modules, power closures, hinges and wireforming, and handles; interior and exterior mirrors, and actuators; and front and rear lighting, tail lamps, and other lighting products. The Seating Systems segment provides recliners, manual and power adjusters, and seat structures. Its Complete Vehicles segment offers modular solutions for system and parts, as well as complete vehicle manufacturing services. The company serves original equipment manufacturer and non-automotive customers, as well as tier 1 companies, and medium and heavy truck manufacturers. Magna International Inc. was founded in 1957 and is based in Aurora, Canada.

About IOCHPE MAXION S/S

Iochpe-Maxion S.A. produces and sells automotive wheels and structural components for light and commercial vehicles in North America, South America, Europe, and internationally. It operates through two segments, Wheels and Structural Components. The company offers heavy steel wheels; light steel wheels for automobiles, pick-up trucks, and SUVs, as well as light and medium-sized commercial vehicles; and light aluminum wheels for vehicles. It also provides heavy structural components, including frames, sidebars, and crossbars; and metal stampings for commercial vehicles, as well as agricultural machinery and aluminum wheels for light vehicles. In addition, the company offers light structural and automotive components, such as metal stampings for passenger vehicles, brake levers, pedal sets, welded assemblies, structural parts, and other automotive components. Further, it produces freight cars, railway wheels, and castings, as well as industrial castings and freight cars. Iochpe-Maxion S.A. was founded in 1918 and is headquartered in Cruzeiro, Brazil.

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