Superior Industries International (SUP) versus Aptiv (APTV) Critical Survey

Superior Industries International (NYSE: SUP) and Aptiv (NYSE:APTV) are both cyclical consumer goods & services companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, earnings, profitability, risk and valuation.

Profitability

This table compares Superior Industries International and Aptiv’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Superior Industries International 0.66% 7.96% 3.32%
Aptiv 8.27% 50.01% 12.88%

Dividends

Superior Industries International pays an annual dividend of $0.36 per share and has a dividend yield of 2.4%. Aptiv pays an annual dividend of $0.88 per share and has a dividend yield of 1.0%. Superior Industries International pays out -180.0% of its earnings in the form of a dividend. Aptiv pays out 17.4% 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. Superior Industries International is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of recent ratings for Superior Industries International and Aptiv, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Superior Industries International 0 1 3 0 2.75
Aptiv 1 2 16 0 2.79

Superior Industries International currently has a consensus price target of $23.75, indicating a potential upside of 56.25%. Aptiv has a consensus price target of $98.32, indicating a potential upside of 10.13%. Given Superior Industries International’s higher probable upside, equities research analysts plainly believe Superior Industries International is more favorable than Aptiv.

Risk & Volatility

Superior Industries International has a beta of 0.92, suggesting that its stock price is 8% less volatile than the S&P 500. Comparatively, Aptiv has a beta of 1.49, suggesting that its stock price is 49% more volatile than the S&P 500.

Insider & Institutional Ownership

84.3% of Superior Industries International shares are owned by institutional investors. Comparatively, 90.9% of Aptiv shares are owned by institutional investors. 1.5% of Superior Industries International shares are owned by insiders. Comparatively, 0.3% of Aptiv shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Superior Industries International and Aptiv’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Superior Industries International $732.70 million 0.52 $41.38 million ($0.20) -76.00
Aptiv $12.88 billion 1.84 $1.36 billion $5.05 17.68

Aptiv has higher revenue and earnings than Superior Industries International. Superior Industries International is trading at a lower price-to-earnings ratio than Aptiv, indicating that it is currently the more affordable of the two stocks.

Summary

Aptiv beats Superior Industries International on 12 of the 16 factors compared between the two stocks.

Superior Industries International Company Profile

Superior Industries International, Inc. is engaged in the design and manufacture of aluminum wheels for sale to original equipment manufacturers (OEMs). The Company supplies cast aluminum wheels to automobile and light truck manufacturers, with wheel manufacturing operations in the United States and Mexico. The Company offers wheels in a range of finishes, which include Bright Machined, Polished Face with Painted Window, Fully Painted, Premium Paint, Polished, Chrome Clad and Mirror Finish Ultra Bright Machining. The Company’s products, which are manufactured in its North American facilities, are delivered primarily to automotive assembly operations in North America for global OEMs. Its OEM aluminum wheels are primarily sold for factory installation, as either optional or standard equipment, on various vehicle models. As of December 31, 2015, the Company operated five manufacturing facilities in the United States and Mexico.

Aptiv Company Profile

Aptiv PLC, formerly Delphi Automotive PLC, is a global technology company serving the automotive sector. The Company designs and manufactures vehicle components, and provides electrical and electronic and active safety technology solutions to the global automotive and commercial vehicle markets. The Company’s segments include Electrical/Electronic Architecture, and Electronics & Safety. The Electrical/Electronic Architecture segment provides complete design of the vehicle’s electrical architecture, including connectors, wiring assemblies and harnesses, electrical centers and hybrid high voltage and safety distribution systems. The Electronics and Safety segment offers a range of electronic and safety equipment and software in the areas of controls, security, infotainment, communications and safety systems.

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