Contrasting Snap-On (SNA) & Its Peers

Snap-On (NYSE: SNA) is one of 56 public companies in the “Industrial Machinery & Equipment” industry, but how does it contrast to its peers? We will compare Snap-On to related businesses based on the strength of its risk, earnings, valuation, institutional ownership, profitability, analyst recommendations and dividends.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Snap-On and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Snap-On 0 2 5 0 2.71
Snap-On Competitors 390 1898 1912 36 2.38

Snap-On presently has a consensus target price of $197.00, suggesting a potential upside of 34.32%. As a group, “Industrial Machinery & Equipment” companies have a potential upside of 7.21%. Given Snap-On’s stronger consensus rating and higher probable upside, equities analysts plainly believe Snap-On is more favorable than its peers.

Volatility and Risk

Snap-On has a beta of 1.05, suggesting that its share price is 5% more volatile than the S&P 500. Comparatively, Snap-On’s peers have a beta of 1.21, suggesting that their average share price is 21% more volatile than the S&P 500.

Earnings and Valuation

This table compares Snap-On and its peers gross revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Snap-On $3.83 billion $971.00 million 15.15
Snap-On Competitors $2.27 billion $359.64 million 23.41

Snap-On has higher revenue and earnings than its peers. Snap-On is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Snap-On and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Snap-On 16.22% 20.90% 11.89%
Snap-On Competitors 1.56% 6.73% 4.64%

Dividends

Snap-On pays an annual dividend of $2.84 per share and has a dividend yield of 1.9%. Snap-On pays out 29.3% of its earnings in the form of a dividend. As a group, “Industrial Machinery & Equipment” companies pay a dividend yield of 1.6% and pay out 35.6% of their earnings in the form of a dividend. Snap-On has increased its dividend for 7 consecutive years. Snap-On is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

93.8% of Snap-On shares are owned by institutional investors. Comparatively, 79.2% of shares of all “Industrial Machinery & Equipment” companies are owned by institutional investors. 3.7% of Snap-On shares are owned by insiders. Comparatively, 5.4% of shares of all “Industrial Machinery & Equipment” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Snap-On beats its peers on 11 of the 15 factors compared.

About Snap-On

Snap-on Incorporated is a manufacturer and marketer of tools, equipment, diagnostics, repair information and systems solutions. The Company’s segments include the Commercial & Industrial Group, the Snap-on Tools Group, the Repair Systems & Information Group, and Financial Services. The Commercial & Industrial Group consists of business operations serving a range of industrial and commercial customers, including customers in the aerospace, natural resources, government, power generation, transportation and technical education markets. The Snap-on Tools Group consists of business operations primarily serving vehicle service and repair technicians. The Repair Systems & Information Group consists of business operations serving other professional vehicle repair customers, primarily owners and managers of independent repair shops and original equipment manufacturer (OEM) dealership service and repair shops. Financial Services consists of the business operations of its finance subsidiaries.

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