Reviewing Allison Transmission (NYSE:ALSN) and Mitsubishi Heavy Industries (OTCMKTS:MHVYF)

Mitsubishi Heavy Industries (OTCMKTS:MHVYF) and Allison Transmission (NYSE:ALSN) are both large-cap industrials companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, analyst recommendations, dividends, profitability and risk.

Earnings & Valuation

This table compares Mitsubishi Heavy Industries and Allison Transmission”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mitsubishi Heavy Industries	$33.04 billion	2.45	$2.19 billion	$0.76	31.58
Allison Transmission	$3.01 billion	3.46	$623.00 million	$6.29	20.03

Mitsubishi Heavy Industries has higher revenue and earnings than Allison Transmission. Allison Transmission is trading at a lower price-to-earnings ratio than Mitsubishi Heavy Industries, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Mitsubishi Heavy Industries and Allison Transmission, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mitsubishi Heavy Industries	0	1	0	1	3.00
Allison Transmission	0	5	2	1	2.50

Allison Transmission has a consensus price target of $131.17, indicating a potential upside of 4.12%. Given Allison Transmission’s higher probable upside, analysts clearly believe Allison Transmission is more favorable than Mitsubishi Heavy Industries.

Risk & Volatility

Mitsubishi Heavy Industries has a beta of 0.51, suggesting that its stock price is 49% less volatile than the S&P 500. Comparatively, Allison Transmission has a beta of 0.98, suggesting that its stock price is 2% less volatile than the S&P 500.

Insider & Institutional Ownership

96.9% of Allison Transmission shares are held by institutional investors. 1.1% of Allison Transmission shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Mitsubishi Heavy Industries and Allison Transmission’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mitsubishi Heavy Industries	7.04%	13.20%	5.02%
Allison Transmission	12.02%	38.18%	9.99%

Summary

Allison Transmission beats Mitsubishi Heavy Industries on 10 of the 14 factors compared between the two stocks.

About Mitsubishi Heavy Industries

Mitsubishi Heavy Industries, Ltd. manufactures and sells heavy machinery worldwide. It operates through Energy Systems; Plants & Infrastructure Systems; Logistics, Thermal & Drive Systems; and Aircraft, Defense & Space segments. The company offers thermal, renewable energy, nuclear power generation, and engine power plants; oil and gas production plants; lithium-ion battery products and fuel cells; civil aircrafts and engines, aviation equipment, and maintenance, repair, and overhaul of aircrafts; and launch vehicles and services, rocket engines, reaction control systems, space stations, rocket launchers, rocket engine combustion test facilities, and electronic parts. It also provides passenger and commercial ships, LNG and LPG carriers, special purpose vessels, and IT services and systems; marine machineries, boilers, turbines, engines, and structures; and intelligent transport systems products and solutions, such as electronic toll collection system, road user charging system, highway traffic management system, EV management system, and development system. In addition, the company offers organic solvent exhaust gas treatment system, waste-to-energy system, sludge treatment system, air quality control system, and bio-treatment system; turbochargers, car air-conditioning and refrigeration systems, rubber and tire machinery, and testing equipment; forklift trucks; and printing, paper converting, and metals, and food & packaging machinery, pumps, compressors & mechanical turbines, hydraulic components. Further, it provides gas holders, vibration control systems, water pipes, tunnel excavation machinery, and cybersecurity solutions for industrial control systems; special vehicles, naval ship and maritime systems, defense aircrafts, helicopters, defense aeroengines, and guided weapon systems; CO2 capture plants; and after-sales services. The company was founded in 1884 and is headquartered in Tokyo, Japan.

About Allison Transmission

Allison Transmission Holdings, Inc., together with its subsidiaries, designs, manufactures, and sells fully automatic transmissions for medium- and heavy-duty commercial vehicles and medium- and heavy-tactical U.S. defense vehicles, and electrified propulsion systems worldwide. It provides commercial-duty on-highway, off-highway and defense fully automatic transmissions, and electric hybrid and fully electric systems. The company offers transmissions for various applications, including distribution, refuse, construction, fire, and emergency on-highway trucks; school and transit buses; motor homes; energy, mining, and construction off-highway vehicles and equipment; and wheeled and tracked defense vehicles. It provides its transmissions and electric propulsion solutions under the Allison Transmission brand name; and remanufactured transmissions under the ReTran brand name. The company also sells branded replacement parts, support equipment, aluminum die cast components, and other products necessary to service the installed base of vehicles utilizing its solutions, as well as defense kits, engineering services, and extended transmission coverage services to various original equipment manufacturers, distributors, and the U.S. government. It serves customers through an independent network of approximately 1,600 independent distributor and dealer locations. The company was formerly known as Clutch Holdings, Inc. Allison Transmission Holdings, Inc. was founded in 1915 and is headquartered in Indianapolis, Indiana.