Critical Analysis: Ingersoll-Rand PLC (Ireland) (IR) versus Proto Labs (PRLB)

Proto Labs (NYSE: PRLB) and Ingersoll-Rand PLC (Ireland) (NYSE:IR) are both mid-cap industrial products companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, earnings, valuation, risk, profitability and dividends.

Insider and Institutional Ownership

80.7% of Ingersoll-Rand PLC (Ireland) shares are held by institutional investors. 7.8% of Proto Labs shares are held by company insiders. Comparatively, 0.7% of Ingersoll-Rand PLC (Ireland) shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Proto Labs and Ingersoll-Rand PLC (Ireland)’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Proto Labs $312.73 million 7.44 $85.30 million $1.75 49.94
Ingersoll-Rand PLC (Ireland) $13.84 billion 1.65 $1.98 billion $4.01 22.73

Ingersoll-Rand PLC (Ireland) has higher revenue and earnings than Proto Labs. Ingersoll-Rand PLC (Ireland) is trading at a lower price-to-earnings ratio than Proto Labs, indicating that it is currently the more affordable of the two stocks.

Dividends

Ingersoll-Rand PLC (Ireland) pays an annual dividend of $1.80 per share and has a dividend yield of 2.0%. Proto Labs does not pay a dividend. Ingersoll-Rand PLC (Ireland) pays out 44.9% of its earnings in the form of a dividend. Proto Labs has raised its dividend for 6 consecutive years.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Proto Labs and Ingersoll-Rand PLC (Ireland), as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Proto Labs 0 2 0 0 2.00
Ingersoll-Rand PLC (Ireland) 0 8 6 0 2.43

Proto Labs presently has a consensus price target of $56.00, indicating a potential downside of 35.93%. Ingersoll-Rand PLC (Ireland) has a consensus price target of $99.67, indicating a potential upside of 9.34%. Given Ingersoll-Rand PLC (Ireland)’s stronger consensus rating and higher probable upside, analysts plainly believe Ingersoll-Rand PLC (Ireland) is more favorable than Proto Labs.

Profitability

This table compares Proto Labs and Ingersoll-Rand PLC (Ireland)’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Proto Labs 14.53% 11.63% 10.54%
Ingersoll-Rand PLC (Ireland) 7.47% 16.65% 6.41%

Volatility and Risk

Proto Labs has a beta of 0.99, meaning that its share price is 1% less volatile than the S&P 500. Comparatively, Ingersoll-Rand PLC (Ireland) has a beta of 1.33, meaning that its share price is 33% more volatile than the S&P 500.

Summary

Ingersoll-Rand PLC (Ireland) beats Proto Labs on 10 of the 17 factors compared between the two stocks.

Proto Labs Company Profile

Proto Labs, Inc. is an e-commerce driven digital manufacturer of on-demand three dimensional (3D) printed, computer numerical control (CNC) machined and injection-molded custom parts for prototyping and short-run production. The Company’s geographic segments include the United States, Europe and Japan. The Company targets its products to the product developers and engineers who use 3D computer-aided design (3D CAD) software to design products across a range of end markets. Its product lines include Injection Molding, CNC Machining and 3D Printing. Its Injection Molding product line is used for prototype, on-demand and short-run production. Its CNC Machining product line uses commercially available CNC machines to cut plastic or metal blocks into one or more custom parts based on the 3D CAD model uploaded by the product developer or engineer. Its 3D Printing product line includes stereolithography (SL), selective laser sintering (SLS) and direct metal laser sintering (DMLS) processes.

Ingersoll-Rand PLC (Ireland) Company Profile

Ingersoll-Rand Public Limited Company provides products, services and solutions to improve the quality and comfort of air in homes and buildings, transport and protect food and perishables. The Company’s business segments include Climate and Industrial. It is engaged in the design, manufacture, sale and service of a portfolio of industrial and commercial products that include brand names, such as Ingersoll-Rand, Trane, American Standard, ARO and Club Car. Its Climate segment includes Trane and American Standard Heating and Air Conditioning, which provide heating, ventilation and air conditioning systems, and commercial and residential building services, parts, support and controls. It offers energy services and building automation through Trane Building Advantage and Nexia. Its Industrial segment includes compressed air and gas systems and services, power tools, material handling systems, ARO fluid management equipment, as well as Club Car golf, utility and rough terrain vehicles.

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