Critical Review: CNH Industrial (CNHI) vs. Its Competitors

CNH Industrial (NYSE: CNHI) is one of 15 public companies in the “Heavy Machinery & Vehicles” industry, but how does it compare to its rivals? We will compare CNH Industrial to similar companies based on the strength of its analyst recommendations, earnings, institutional ownership, valuation, risk, dividends and profitability.

Analyst Ratings

This is a summary of recent ratings for CNH Industrial and its rivals, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CNH Industrial 1 2 5 0 2.50
CNH Industrial Competitors 171 890 965 17 2.41

CNH Industrial currently has a consensus price target of $12.43, suggesting a potential downside of 4.73%. As a group, “Heavy Machinery & Vehicles” companies have a potential upside of 7.14%. Given CNH Industrial’s rivals higher probable upside, analysts plainly believe CNH Industrial has less favorable growth aspects than its rivals.

Earnings and Valuation

This table compares CNH Industrial and its rivals top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
CNH Industrial $24.87 billion -$252.00 million 40.78
CNH Industrial Competitors $6.06 billion $48.37 million 123.40

CNH Industrial has higher revenue, but lower earnings than its rivals. CNH Industrial is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares CNH Industrial and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CNH Industrial 1.66% 14.63% 1.41%
CNH Industrial Competitors 4.06% 13.41% 3.96%

Volatility & Risk

CNH Industrial has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500. Comparatively, CNH Industrial’s rivals have a beta of 1.43, suggesting that their average share price is 43% more volatile than the S&P 500.

Dividends

CNH Industrial pays an annual dividend of $0.12 per share and has a dividend yield of 0.9%. CNH Industrial pays out 37.5% of its earnings in the form of a dividend. As a group, “Heavy Machinery & Vehicles” companies pay a dividend yield of 1.3% and pay out 35.9% of their earnings in the form of a dividend. CNH Industrial lags its rivals as a dividend stock, given its lower dividend yield and higher payout ratio.

Insider and Institutional Ownership

18.2% of CNH Industrial shares are held by institutional investors. Comparatively, 82.2% of shares of all “Heavy Machinery & Vehicles” companies are held by institutional investors. 8.9% of shares of all “Heavy Machinery & Vehicles” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

CNH Industrial rivals beat CNH Industrial on 11 of the 15 factors compared.

About CNH Industrial

CNH Industrial N.V. is a capital goods company. The Company is engaged in the design, production, marketing, sale and financing of agricultural and construction equipment, trucks, commercial vehicles, buses and specialty vehicles for firefighting, defense and other uses, as well as engines, transmissions and axles for vehicles and engines under marine and power generation applications. Its segments include Agricultural Equipment, which designs, manufactures and distributes farm machinery and implements; Construction Equipment, which designs, manufactures and distributes construction equipment; Commercial Vehicles, which designs, produces and sells a range of light, medium and heavy vehicles for the transportation and distribution of goods; Powertrain, which designs, manufactures and offers a range of propulsion and transmission systems, and axles for on- and off-road applications, and Financial Services, which offers a range of financial services to dealers and customers.

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