Contrasting Komatsu (KMTUY) and Its Rivals

Komatsu (OTCMKTS:KMTUY) is one of 436 public companies in the “Machinery” industry, but how does it compare to its competitors? We will compare Komatsu to related businesses based on the strength of its valuation, earnings, dividends, profitability, institutional ownership, analyst recommendations and risk.

Dividends

Komatsu pays an annual dividend of $0.89 per share and has a dividend yield of 2.4%. Komatsu pays out 32.0% of its earnings in the form of a dividend. As a group, “Machinery” companies pay a dividend yield of 2.8% and pay out 24.6% of their earnings in the form of a dividend. Komatsu lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Profitability

This table compares Komatsu and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Komatsu	8.92%	10.56%	5.94%
Komatsu Competitors	-1,044.43%	-15.08%	0.57%

Insider and Institutional Ownership

0.2% of Komatsu shares are owned by institutional investors. Comparatively, 51.8% of shares of all “Machinery” companies are owned by institutional investors. 2.9% of Komatsu shares are owned by insiders. Comparatively, 14.2% of shares of all “Machinery” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Komatsu and its competitors top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Komatsu	$27.45 billion	$2.48 billion	13.39
Komatsu Competitors	$4.61 billion	$364.05 million	5.04

Komatsu has higher revenue and earnings than its competitors. Komatsu is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Analyst Recommendations

This is a summary of current ratings and target prices for Komatsu and its competitors, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Komatsu	0	1	0	2	3.33
Komatsu Competitors	4201	14703	18211	806	2.41

As a group, “Machinery” companies have a potential upside of 35.32%. Given Komatsu’s competitors higher probable upside, analysts plainly believe Komatsu has less favorable growth aspects than its competitors.

Volatility & Risk

Komatsu has a beta of 1.09, suggesting that its stock price is 9% more volatile than the S&P 500. Comparatively, Komatsu’s competitors have a beta of 5.12, suggesting that their average stock price is 412% more volatile than the S&P 500.

Summary

Komatsu beats its competitors on 8 of the 15 factors compared.

Komatsu Company Profile

Komatsu Ltd. manufactures and sells construction, mining, and utility equipment in Japan, the Americas, Europe, China, Rest of Asia, Oceania, the Middle East, Africa, and CIS countries. It operates through three segments: Construction, Mining and Utility Equipment; Retail Finance; and Industrial Machinery and Others. The company offers construction and mining equipment, including excavators, wheel loaders, bulldozers, motor graders, dump truck, rope and hybrid shovels, electric wheel loaders, continuous miners, and jumbo drills. It also provides forestry equipment, including harvesters, forwarders, feller bunchers, excavators, mini excavators, and forklifts; demolition, waste, and recycling equipment, such as mobile crushers, hydraulic excavators, wheel loaders, and mini shovels; material handling equipment; and tunnel-boring machines, pipe layers, towing tractors, and engines. In addition, the company offers industrial machinery, including presses, sheet-metal machinery, 3D laser cutting machine, transfer machines, battery manufacturing equipment, wire saws, thermos modules, thermoelectric generation module, and temperature control products; quarry equipment; agricultural and livestock equipment; EH sensor device; iron and steel casting products; and logistics equipment. Further, the company provides retail financing; construction machinery rental services; remanufactured products; other support services; transportation, warehousing, packing, and other services; and purchases and sells used equipment. Komatsu Ltd. was founded in 1884 and is headquartered in Tokyo, Japan.