Raven Industries (NASDAQ: RAVN) and Trinity Industries (NYSE:TRN) are both multi-sector conglomerates companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, analyst recommendations, institutional ownership, profitability and risk.
Risk & Volatility
Raven Industries has a beta of 1.36, indicating that its share price is 36% more volatile than the S&P 500. Comparatively, Trinity Industries has a beta of 2.18, indicating that its share price is 118% more volatile than the S&P 500.
Insider and Institutional Ownership
73.6% of Raven Industries shares are held by institutional investors. Comparatively, 80.8% of Trinity Industries shares are held by institutional investors. 1.8% of Raven Industries shares are held by insiders. Comparatively, 2.0% of Trinity Industries shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Raven Industries pays an annual dividend of $0.52 per share and has a dividend yield of 1.5%. Trinity Industries pays an annual dividend of $0.52 per share and has a dividend yield of 1.8%. Raven Industries pays out 70.3% of its earnings in the form of a dividend. Trinity Industries pays out 32.1% 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. Trinity Industries has increased its dividend for 6 consecutive years. Trinity Industries is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This is a breakdown of current ratings and price targets for Raven Industries and Trinity Industries, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Raven Industries currently has a consensus price target of $33.00, suggesting a potential downside of 1.93%. Trinity Industries has a consensus price target of $26.29, suggesting a potential downside of 8.03%. Given Raven Industries’ stronger consensus rating and higher probable upside, research analysts clearly believe Raven Industries is more favorable than Trinity Industries.
This table compares Raven Industries and Trinity Industries’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings & Valuation
This table compares Raven Industries and Trinity Industries’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Raven Industries||$302.57 million||4.02||$56.53 million||$0.74||45.47|
|Trinity Industries||$4.00 billion||1.08||$858.50 million||$1.62||17.64|
Trinity Industries has higher revenue and earnings than Raven Industries. Trinity Industries is trading at a lower price-to-earnings ratio than Raven Industries, indicating that it is currently the more affordable of the two stocks.
Trinity Industries beats Raven Industries on 10 of the 17 factors compared between the two stocks.
About Raven Industries
Raven Industries, Inc. is a diversified technology company providing a range of products to customers within the industrial, agricultural, energy, construction and defense markets. The Company operates through three segments: Applied Technology Division (Applied Technology), Engineered Films Division (Engineered Films) and Aerostar Division (Aerostar). The Applied Technology segment designs, manufactures, sells and services precision agriculture products and information management tools for growers. The Engineered Films segment produces plastic films and sheeting for energy, agricultural, construction, geomembrane and industrial applications. The Aerostar segment designs and manufactures products, including balloons, tethered aerostats and radar processing systems. It conducts business through its subsidiaries, including Aerostar International, Inc. (Aerostar), Vista Research, Inc. (Vista), Raven International Holding Company BV (Raven Holdings) and Raven Industries Canada, Inc.
About Trinity Industries
Trinity Industries, Inc. is a diversified industrial company that owns businesses providing products and services to the energy, chemical, agriculture, transportation and construction sectors. The Company’s products and services include railcars and railcar parts; parts and steel components; the leasing, management and maintenance of railcars; highway products; construction aggregates; inland barges; structural wind towers; steel utility structures; storage and distribution containers, and trench shields and shoring products. The Company’s segments include the Rail Group, Construction Products Group, Inland Barge Group, Energy Equipment Group, Railcar Leasing and Management Services Group, and All Other. Its All Other segment includes its captive insurance and transportation companies, and other peripheral businesses. It manufactures a line of railcars, including autorack cars, box cars, covered hopper cars, gondola cars, intermodal cars, open hopper cars and tank cars.
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