Financial Survey: Art’s-Way Manufacturing (NASDAQ:ARTW) versus Otis Worldwide (NYSE:OTIS)

Art’s-Way Manufacturing (NASDAQ:ARTW) and Otis Worldwide (NYSE:OTIS) are both industrials companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, earnings, profitability, institutional ownership, risk, valuation and analyst recommendations.

Insider & Institutional Ownership

2.9% of Art’s-Way Manufacturing shares are held by institutional investors. Comparatively, 88.0% of Otis Worldwide shares are held by institutional investors. 51.5% of Art’s-Way Manufacturing shares are held by insiders. Comparatively, 0.1% of Otis Worldwide shares are held by 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.

Risk & Volatility

Art’s-Way Manufacturing has a beta of 1.06, meaning that its stock price is 6% more volatile than the S&P 500. Comparatively, Otis Worldwide has a beta of 0.87, meaning that its stock price is 13% less volatile than the S&P 500.

Dividends

Art’s-Way Manufacturing pays an annual dividend of $0.05 per share and has a dividend yield of 1.4%. Otis Worldwide pays an annual dividend of $1.76 per share and has a dividend yield of 2.7%. Art’s-Way Manufacturing pays out -500.0% of its earnings in the form of a dividend. Otis Worldwide pays out 45.2% 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. Otis Worldwide has raised its dividend for 5 consecutive years. Otis Worldwide is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Art’s-Way Manufacturing and Otis Worldwide”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Art’s-Way Manufacturing	$25.99 million	0.71	$1.03 million	($0.01)	-354.00
Otis Worldwide	$14.43 billion	1.74	$1.38 billion	$3.89	16.95

Otis Worldwide has higher revenue and earnings than Art’s-Way Manufacturing. Art’s-Way Manufacturing is trading at a lower price-to-earnings ratio than Otis Worldwide, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Art’s-Way Manufacturing and Otis Worldwide’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Art’s-Way Manufacturing	-0.08%	-0.16%	-0.10%
Otis Worldwide	10.17%	-28.50%	14.39%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Art’s-Way Manufacturing and Otis Worldwide, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Art’s-Way Manufacturing	1	0	0	0	1.00
Otis Worldwide	2	4	4	0	2.20

Otis Worldwide has a consensus target price of $91.00, indicating a potential upside of 38.00%. Given Otis Worldwide’s stronger consensus rating and higher probable upside, analysts clearly believe Otis Worldwide is more favorable than Art’s-Way Manufacturing.

Summary

Otis Worldwide beats Art’s-Way Manufacturing on 13 of the 17 factors compared between the two stocks.

About Art’s-Way Manufacturing

Art’s-Way Manufacturing Co., Inc. manufactures and distributes farm equipment products. It operates through the Agricultural Products, and Modular Buildings segments. The Agricultural Products segment manufactures a variety of specialized farm machinery under its own label including portable and stationary animal feed processing equipment and related attachments used to mill and mix feed grains into custom animal feed rations, a line of forage equipment consisting of forage boxes, bale processors, running gear, and dump boxes, a line of manure spreaders, sugar beet harvesting equipment, and a line of dirt work equipment. The Modular Buildings segment produces and sells modular buildings, which are custom designed to meet the specific research needs of its customers. It also provides services relating to the design, manufacturing, delivery, installation and renting of the building units that it produces. The company was founded by Arthur Luscombe in 1956 and is headquartered in Armstrong, IA.

About Otis Worldwide

Otis Worldwide Corporation engages in manufacturing, installation, and servicing of elevators and escalators in the United States, China, and internationally. The company operates in two segments, New Equipment and Service. The New Equipment segment designs, manufactures, sells, and installs a range of passenger and freight elevators, as well as escalators and moving walkways for residential and commercial buildings, and infrastructure projects. This segment serves real-estate and building developers, and general contractors. It sells its products directly to customers, as well as through agents and distributors. The Service segment performs maintenance and repair services, as well as modernization services to upgrade elevators and escalators. Otis Worldwide Corporation was founded in 1853 and is headquartered in Farmington, Connecticut.