Tata Motors (NYSE: TTM) and Toyota Motor Corp Ltd Ord (NYSE:TM) are both large-cap auto/tires/trucks companies, but which is the superior stock? We will compare the two companies based on the strength of their valuation, profitabiliy, dividends, analyst recommendations, institutional ownership, earnings and risk.
This table compares Tata Motors and Toyota Motor Corp Ltd Ord’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Toyota Motor Corp Ltd Ord||6.64%||10.29%||3.89%|
Volatility and Risk
Tata Motors has a beta of 2.26, suggesting that its share price is 126% more volatile than the S&P 500. Comparatively, Toyota Motor Corp Ltd Ord has a beta of 0.6, suggesting that its share price is 40% less volatile than the S&P 500.
Earnings & Valuation
This table compares Tata Motors and Toyota Motor Corp Ltd Ord’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Tata Motors||$41.96 billion||N/A||$3.71 billion||$1.40||25.49|
|Toyota Motor Corp Ltd Ord||$245.45 billion||0.66||$32.07 billion||$11.07||9.87|
Toyota Motor Corp Ltd Ord has higher revenue and earnings than Tata Motors. Toyota Motor Corp Ltd Ord is trading at a lower price-to-earnings ratio than Tata Motors, indicating that it is currently the more affordable of the two stocks.
Toyota Motor Corp Ltd Ord pays an annual dividend of $3.54 per share and has a dividend yield of 3.2%. Tata Motors does not pay a dividend. Toyota Motor Corp Ltd Ord pays out 32.0% of its earnings in the form of a dividend.
Insider and Institutional Ownership
13.8% of Tata Motors shares are owned by institutional investors. Comparatively, 0.9% of Toyota Motor Corp Ltd Ord 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.
This is a summary of current ratings for Tata Motors and Toyota Motor Corp Ltd Ord, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Toyota Motor Corp Ltd Ord||1||4||1||0||2.00|
Tata Motors presently has a consensus price target of $48.00, indicating a potential upside of 34.49%. Toyota Motor Corp Ltd Ord has a consensus price target of $112.11, indicating a potential upside of 2.56%. Given Tata Motors’ stronger consensus rating and higher probable upside, equities analysts plainly believe Tata Motors is more favorable than Toyota Motor Corp Ltd Ord.
Tata Motors beats Toyota Motor Corp Ltd Ord on 9 of the 14 factors compared between the two stocks.
About Tata Motors
Tata Motors Limited is an automobile company. The Company is engaged in manufacture of motor vehicles. The Company is engaged mainly in the business of automobile products consisting of all types of commercial and passenger vehicles, including financing of the vehicles sold by the Company. The Company’s segments include automotive operations and all other operations. The Company’s automotive segment operations include all activities relating to the development, design, manufacture, assembly and sale of vehicles, including vehicle financing, as well as sale of related parts and accessories. In the automotive segment, the Company manufactures and sells passenger cars, utility vehicles, light commercial vehicles, and medium and heavy commercial vehicles. The Company’s all other operations segment mainly includes information technology (IT) services, and machine tools and factory automation services. The Company operates in over 160 countries across the world.
About Toyota Motor Corp Ltd Ord
Toyota Motor Corporation (Toyota) conducts business in the automotive industry. The Company also conducts business in finance and other industries. The Company’s segments include Automotive, Financial Services and All Other. Toyota sells its vehicles in approximately 190 countries and regions. Toyota’s markets for its automobiles are Japan, North America, Europe and Asia. The Company’s Automotive segment includes the design, manufacture, assembly and sale of passenger vehicles, minivans and commercial vehicles, such as trucks and related parts and accessories. The Company’s Financial Services segment consists of providing financing to dealers and their customers for the purchase or lease of Toyota vehicles. The All Other segment includes the design, manufacturing and sale of housing, telecommunications and other businesses. Its information technology related businesses include a Web portal for automobile information called GAZOO.com.
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