Head to Head Comparison: Emerson Electric (NYSE:EMR) and Kone Oyj (OTCMKTS:KNYJY)

Emerson Electric (NYSE:EMR) and Kone Oyj (OTCMKTS:KNYJY) are both large-cap industrials companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, profitability, valuation, dividends and risk.

Insider and Institutional Ownership

74.3% of Emerson Electric shares are owned by institutional investors. 0.5% of Emerson Electric shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Dividends

Emerson Electric pays an annual dividend of $2.22 per share and has a dividend yield of 1.7%. Kone Oyj pays an annual dividend of $0.41 per share and has a dividend yield of 1.2%. Emerson Electric pays out 55.0% of its earnings in the form of a dividend. Kone Oyj pays out 40.2% 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. Emerson Electric has raised its dividend for 68 consecutive years. Emerson Electric is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares Emerson Electric and Kone Oyj”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Emerson Electric	$18.02 billion	4.05	$1.97 billion	$4.04	32.07
Kone Oyj	$12.01 billion	2.57	$1.03 billion	$1.02	33.44

Emerson Electric has higher revenue and earnings than Kone Oyj. Emerson Electric is trading at a lower price-to-earnings ratio than Kone Oyj, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Emerson Electric has a beta of 1.3, suggesting that its stock price is 30% more volatile than the S&P 500. Comparatively, Kone Oyj has a beta of 0.65, suggesting that its stock price is 35% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Emerson Electric and Kone Oyj, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Emerson Electric	1	6	11	2	2.70
Kone Oyj	1	1	0	0	1.50

Emerson Electric currently has a consensus target price of $148.56, suggesting a potential upside of 14.67%. Given Emerson Electric’s stronger consensus rating and higher possible upside, research analysts clearly believe Emerson Electric is more favorable than Kone Oyj.

Profitability

This table compares Emerson Electric and Kone Oyj’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Emerson Electric	14.92%	14.34%	7.79%
Kone Oyj	8.48%	39.83%	10.94%

Summary

Emerson Electric beats Kone Oyj on 14 of the 18 factors compared between the two stocks.

About Emerson Electric

Emerson Electric Co., a technology and software company, provides various solutions for customers in industrial, commercial, and consumer markets in the Americas, Asia, the Middle East, Africa, and Europe. It operates in six segments: Final Control, Control Systems & Software, Measurement & Analytical, AspenTech, Discrete Automation, and Safety & Productivity. The Final Control segment provides control, isolation, shutoff, pressure relief, and pressure safety valves, actuators, and regulators for process and hybrid industries. The Measurement & Analytical segment offers intelligent instrumentation measuring the physical properties of liquids or gases, such as pressure, temperature, level, flow, acoustics, corrosion, pH, conductivity, water quality, toxic gases, and flame. The Discrete Automation segment offers solenoid and pneumatic valves, valve position indicators, pneumatic cylinders, air preparation equipment, pressure and temperature switches, electric linear motion solutions, programmable automation control systems, electrical distribution equipment, and materials joining solutions. The Safety & Productivity segment offers tools for professionals and homeowners; pipe-working tools, including pipe wrenches, pipe cutters, pipe threading and roll grooving equipment, battery hydraulic tools; electrical tools; and other professional tools. The Control Systems & Software segment provides distributed control systems, safety instrumented systems, SCADA systems, application software, digital twins, asset performance management, and cybersecurity. The Test & Measurement provides software-connected automated test and measurement systems. The AspenTech segment provides asset optimization software that enables industrial manufacturers to design, operate, and maintain operations for enhancing performance through a combination of decades of modeling, simulation, and optimization capabilities. The company was incorporated in 1890 and is headquartered in Saint Louis, Missouri.

About Kone Oyj

KONE Oyj, together with its subsidiaries, engages in the elevator and escalator business worldwide. The company provides elevators, escalators, and automatic building doors. It offers maintenance services; and modernization solutions. In addition, the company offers KONE Office Flow, a connected solution that allows for personalized user experiences and touch-free access; health and well-being solutions for elevators, escalators, and doors; KONE Access, an access control system, which is integrated with elevator system and building doors; KONE Destination, a destination control system that reduce waiting and travel times; KONE infotainment, a communication channel for building tenants and visitors; and monitoring solutions that enable real-time inspection of elevators and escalators. Further, it provides people flow planning and consulting services; solutions for special buildings and large projects; cybersecurity solutions; and energy solutions for greener buildings. KONE Oyj was founded in 1908 and is based in Espoo, Finland.