Sekisui House (OTCMKTS:SKHSY) vs. Garmin (NYSE:GRMN) Financial Review

Garmin (NYSE:GRMN) and Sekisui House (OTCMKTS:SKHSY) are both large-cap consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, earnings, risk, valuation, profitability, institutional ownership and dividends.

Insider and Institutional Ownership

81.6% of Garmin shares are owned by institutional investors. Comparatively, 0.0% of Sekisui House shares are owned by institutional investors. 14.8% of Garmin shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations and price targets for Garmin and Sekisui House, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Garmin	0	4	2	2	2.75
Sekisui House	0	0	0	1	4.00

Garmin currently has a consensus price target of $310.17, indicating a potential upside of 12.56%. Given Garmin’s higher possible upside, equities research analysts plainly believe Garmin is more favorable than Sekisui House.

Profitability

This table compares Garmin and Sekisui House’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Garmin	24.47%	20.95%	17.06%
Sekisui House	6.09%	11.36%	4.85%

Valuation and Earnings

This table compares Garmin and Sekisui House”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Garmin	$7.25 billion	7.33	$1.66 billion	$9.70	28.41
Sekisui House	$28.07 billion	0.50	$1.56 billion	$2.60	8.24

Garmin has higher earnings, but lower revenue than Sekisui House. Sekisui House is trading at a lower price-to-earnings ratio than Garmin, indicating that it is currently the more affordable of the two stocks.

Dividends

Garmin pays an annual dividend of $4.20 per share and has a dividend yield of 1.5%. Sekisui House pays an annual dividend of $0.34 per share and has a dividend yield of 1.6%. Garmin pays out 43.3% of its earnings in the form of a dividend. Sekisui House pays out 13.1% 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. Garmin has increased its dividend for 8 consecutive years. Sekisui House is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

Garmin has a beta of 0.85, suggesting that its share price is 15% less volatile than the S&P 500. Comparatively, Sekisui House has a beta of 0.37, suggesting that its share price is 63% less volatile than the S&P 500.

Summary

Garmin beats Sekisui House on 14 of the 18 factors compared between the two stocks.

About Garmin

Garmin Ltd. designs, develops, manufactures, markets, and distributes a range of wireless devices worldwide. Its Fitness segment offers running and multi-sport watches; cycling products; smartwatch devices; scales and monitors; and fitness accessories. This segment also provides Garmin Connect and Garmin Connect Mobile, which are web and mobile platforms where users can track and analyze their fitness, activities and workouts, and wellness data; and Connect IQ, an application development platform. The company's Outdoor segment offers adventure watches, outdoor handhelds and satellite communicators, golf devices, consumer automotive devices, and dog devices, as well as InReach and Gramin response communication device. Its Aviation segment designs, manufactures, and markets various aircraft avionics solutions, including integrated flight decks, electronic flight displays and instrumentation, navigation and communication products, automatic flight control systems and safety-enhancing technologies, audio control systems, engine indication systems, traffic awareness and avoidance solutions, ADS-B and transponders, weather information and avoidance solutions, datalink and connectivity solutions, and various services. The company's Marine segment provides chartplotters and multi-function displays, cartography products, fishfinders, sonar products, autopilot systems, radars, compliant instrument displays and sensors, VHF communication radios, handhelds and wearable devices, sailing products, audio products and accessories, digital switching products, and trolling motors. Its Auto segment offers embedded domain controllers and infotainment units; and software, map database, cameras, wearables, and automotive solutions. The company sells its products through independent retailers, dealers, distributors, installation and repair shops, and original equipment manufacturers, as well as online webshop. Garmin Ltd. was founded in 1989 and is based in Schaffhausen, Switzerland.

About Sekisui House

Sekisui House, Ltd. designs, constructs, and contracts built-to-order detached houses in Japan and internationally. The company operates through Custom Detached Houses, Rental Housing, Architectural/Civil Engineering, Remodeling, Real Estate Management Fees, Houses For Sale, Condominiums, Urban Redevelopment, and Overseas segments. It also engages in contracting of design and construction of custom detached houses, rental housing, office building, commercial buildings, and other properties; construction of reinforced concrete rental housing and commercial buildings; contracting of design and construction of civil engineering works; remodeling and renovation of houses; subleasing, management, operation, and brokerage of real estate; sale of houses and residential land; and sales of condominiums. Sekisui House, Ltd. was incorporated in 1929 and is headquartered in Osaka, Japan.