VALEO/S (OTCMKTS: CTTAY) and Continental (OTCMKTS:CTTAY) are both large-cap auto/tires/trucks companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, dividends, institutional ownership, risk, valuation, analyst recommendations and earnings.
Volatility & Risk
VALEO/S has a beta of 1.31, meaning that its stock price is 31% more volatile than the S&P 500. Comparatively, Continental has a beta of 1.33, meaning that its stock price is 33% more volatile than the S&P 500.
Institutional and Insider Ownership
0.3% of VALEO/S shares are held by institutional investors. Comparatively, 0.1% of Continental shares are held by institutional investors. 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.
VALEO/S pays an annual dividend of $0.60 per share and has a dividend yield of 2.8%. Continental pays an annual dividend of $0.77 per share and has a dividend yield of 2.2%. VALEO/S pays out 28.8% of its earnings in the form of a dividend. Continental pays out 22.8% 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.
This table compares VALEO/S and Continental’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent recommendations and price targets for VALEO/S and Continental, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Valuation & Earnings
This table compares VALEO/S and Continental’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|VALEO/S||$20.97 billion||0.49||$1.00 billion||$2.08||10.41|
|Continental||$49.74 billion||0.71||$3.37 billion||$3.37||10.46|
Continental has higher revenue and earnings than VALEO/S. VALEO/S is trading at a lower price-to-earnings ratio than Continental, indicating that it is currently the more affordable of the two stocks.
Continental beats VALEO/S on 11 of the 14 factors compared between the two stocks.
VALEO/S Company Profile
Valeo SA designs, produces, and sells components, integrated systems, and modules for the automotive sector worldwide. The company operates through four segments: Comfort & Driving Assistance Systems, Powertrain Systems, Thermal Systems, and Visibility Systems. It offers parking and driving assistance products, such as ultrasonic sensors, radars, and cameras to detect obstacles around vehicles; interior controls products; and a range of connectivity solutions from short-range to long-range connectivity, as well as develops systems that enable the integration of applications, such as car sharing services and remote parking systems. The company also manufactures powertrain systems, including electric powertrain systems for the electric cars; products that enable the automation of transmissions to reduce fuel consumption and enhance driving comfort; and clean engines for vehicles. In addition, it develops and manufactures systems, modules, and components to ensure the optimal thermal energy management of vehicles and in-vehicle comfort for passengers. Further, the company designs and produces lighting and wiper systems for drivers in all weather conditions. In addition, it offers original equipment spares to auto manufacturers and the independent aftermarket; replacement parts and accessories for passenger cars and commercial vehicles; air conditioning systems for buses; cabin 3D image processing software; hydraulic actuators; and torque converters. Valeo SA was founded in 1923 and is headquartered in Paris, France.
Continental Company Profile
Continental Aktiengesellschaft provides products and services primarily for the automotive industry worldwide. It operates through Chassis&Safety, Powertrain, Interior, Tires, and ContiTech segments. The Chassis&Safety segment develops, produces, and markets intelligent systems to enhance driving safety and vehicle dynamics. This segment offers advanced driver assistance systems, hydraulic brake systems, passive safety and sensoric products, and vehicle dynamics products. The Powertrain segment provides engine systems, fuel and exhaust management systems, hybrid electric vehicles, sensors and actuators, and transmission products. The Interior segment develops and produces information, communication, and network solutions for cars and commercial vehicles, such as body and security, commercial vehicle and aftermarket, infotainment and connectivity, instrumentation and driver HMI, and intelligent transportation systems. The Tires segment provides passenger and light truck equipment, commercial vehicle, and two-wheel tires for use in vehicle manufacture and replacement businesses. The ContiTech segment develops, manufactures, and markets functional parts, and intelligent components and systems made of rubber, plastic, metal, and fabric for the machine and plant engineering, mining, agriculture, automotive, and other industries. This segment provides air spring systems, industrial fluid solutions, mobile fluid systems, and vibration control products, as well as conveyor belts and power transmission products. It also offers design, functional, foam, and compact foils, as well as artificial leather for the furniture and construction industries, as well as automotive sector. The company also provides engineering, business consulting, and fleet services. Continental Aktiengesellschaft was founded in 1871 and is headquartered in Hanover, Germany.
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