Kinder Morgan Management (NYSE: KMR) and Smith (A.O.) (NYSE:AOS) are both large-cap electrical components & equipment – nec companies, but which is the better business? We will compare the two companies based on the strength of their earnings, institutional ownership, dividends, profitability, analyst recommendations, risk and valuation.
Institutional and Insider Ownership
75.3% of Smith (A.O.) shares are owned by institutional investors. 1.3% of Smith (A.O.) shares are owned 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.
This is a breakdown of current recommendations and price targets for Kinder Morgan Management and Smith (A.O.), as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Kinder Morgan Management||0||0||0||0||N/A|
Smith (A.O.) has a consensus price target of $62.40, indicating a potential upside of 1.69%. Given Smith (A.O.)’s higher possible upside, analysts plainly believe Smith (A.O.) is more favorable than Kinder Morgan Management.
Valuation and Earnings
This table compares Kinder Morgan Management and Smith (A.O.)’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Kinder Morgan Management||N/A||N/A||N/A||$1.85||56.60|
|Smith (A.O.)||$2.69 billion||3.93||$326.50 million||$2.04||30.08|
Smith (A.O.) has higher revenue and earnings than Kinder Morgan Management. Smith (A.O.) is trading at a lower price-to-earnings ratio than Kinder Morgan Management, indicating that it is currently the more affordable of the two stocks.
Smith (A.O.) pays an annual dividend of $0.56 per share and has a dividend yield of 0.9%. Kinder Morgan Management does not pay a dividend. Smith (A.O.) pays out 27.5% of its earnings in the form of a dividend. Kinder Morgan Management has raised its dividend for 11 consecutive years.
Volatility and Risk
Kinder Morgan Management has a beta of 0.61, meaning that its stock price is 39% less volatile than the S&P 500. Comparatively, Smith (A.O.) has a beta of 1.55, meaning that its stock price is 55% more volatile than the S&P 500.
This table compares Kinder Morgan Management and Smith (A.O.)’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Kinder Morgan Management||N/A||N/A||N/A|
Smith (A.O.) beats Kinder Morgan Management on 11 of the 13 factors compared between the two stocks.
Kinder Morgan Management Company Profile
Kinder Morgan Management, LLC is a limited partner in Kinder Morgan Energy Partners, L.P (KMP), and manages and controls its business and affairs pursuant to a delegation of control agreement. Kinder Morgan G.P., Inc., of which Kinder Morgan, Inc. indirectly owns all of the outstanding common equity, is the general partner of Kinder Morgan Energy Partners, L.P. (KMP). Kinder Morgan G.P., Inc., pursuant to a delegation of control agreement among the Company, Kinder Morgan G.P., Inc. and KMP, has delegated to the Company, to the fullest extent permitted under Delaware law and KMP’s limited partnership agreement, all of its rights and powers to manage and control the business and affairs of KMP, subject to the general partner’s right to approve specified actions.
Smith (A.O.) Company Profile
A. O. Smith Corporation operates through two segments: North America and Rest of World. The Company’s Rest of World segment primarily consists of China, Europe and India. Both segments manufacture and market comprehensive lines of residential and commercial gas, gas tankless and electric water heaters, as well as water treatment products. Both segments primarily manufacture and market in their respective regions of the world. Its North America segment manufactures and globally markets specialty commercial water heating equipment, condensing and non-condensing boilers and water systems tanks. It also manufactures and markets in-home air purification products in China. It serves residential and commercial end markets in North America with a range of products, which include water heaters, boilers and other. It supplies water heaters to the residential market in China with a broad product offering, including electric, gas, gas tankless, heat pump and solar units, as well as combi boilers.
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