Head-To-Head Contrast: Miller Industries (NYSE:MLR) vs. Magna International (NYSE:MGA)

Miller Industries (NYSE:MLR) and Magna International (NYSE:MGA) are both auto/tires/trucks companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, valuation and dividends.

Institutional and Insider Ownership

79.2% of Miller Industries shares are held by institutional investors. Comparatively, 67.5% of Magna International shares are held by institutional investors. 4.4% of Miller Industries shares are held by company insiders. Comparatively, 0.5% of Magna International shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Dividends

Miller Industries pays an annual dividend of $0.80 per share and has a dividend yield of 2.1%. Magna International pays an annual dividend of $1.94 per share and has a dividend yield of 3.6%. Miller Industries pays out 30.8% of its earnings in the form of a dividend. Magna International pays out 53.0% 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. Miller Industries has raised its dividend for 2 consecutive years and Magna International has raised its dividend for 6 consecutive years. Magna International is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk & Volatility

Miller Industries has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500. Comparatively, Magna International has a beta of 1.53, meaning that its share price is 53% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Miller Industries and Magna International, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Miller Industries	0	2	1	0	2.33
Magna International	1	14	3	0	2.11

Miller Industries currently has a consensus target price of $55.00, suggesting a potential upside of 43.89%. Magna International has a consensus target price of $50.33, suggesting a potential downside of 6.70%. Given Miller Industries’ stronger consensus rating and higher probable upside, research analysts plainly believe Miller Industries is more favorable than Magna International.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Miller Industries	3.59%	7.32%	4.76%
Magna International	2.50%	11.88%	4.59%

Earnings and Valuation

This table compares Miller Industries and Magna International”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Miller Industries	$1.26 billion	0.35	$63.49 million	$2.60	14.70
Magna International	$42.84 billion	0.35	$1.01 billion	$3.66	14.74

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

Summary

Magna International beats Miller Industries on 10 of the 17 factors compared between the two stocks.

About Miller Industries

Miller Industries, Inc., together with its subsidiaries, manufactures and sells towing and recovery equipment. The company offers wreckers that are used to recover and tow disabled vehicles and other equipment; and car carriers, which are specialized flat-bed vehicles with hydraulic tilt mechanisms, which are used to transport new or disabled vehicles and other equipment. It also provides transport trailers for moving various vehicles for auto auctions, car dealerships, leasing companies, and other similar operations. The company markets its products under the Century, Vulcan, Challenger, Holmes, Champion, Chevron, Eagle, Titan, Jige, and Boniface brands. Miller Industries, Inc. sells its products through independent distributors in North America, and Canada, Mexico; and through prime contractors to governmental entities. Miller Industries, Inc. was incorporated in 1990 and is headquartered in Ooltewah, Tennessee.

About Magna International

Magna International Inc. designs, engineers, and manufactures components, assemblies, systems, subsystems, and modules for original equipment manufacturers of vehicles and light trucks worldwide. It operates through four segments: Body Exteriors & Structures, Power & Vision, Seating Systems, and Complete Vehicles. The Body Exteriors & Structures segment provides body and chassis system, battery enclosures, and engineering and testing; and exteriors, including fascia and trims, front end modules, integration panels, liftgate modules, active aerodynamics, engineered glass, running boards, truck bed access products, breakthrough lightings, side doors, and greenhouse products. The Power & Vision segment offers electric drive systems and components, such as emotors, inverters, onboard chargers, gearboxes, and e-clutch; dedicated hybrid drives, dual and hybrid dual clutch, and manual transmissions; AWD/4WD products and rear drive modules; transmission, driveline components, and ICE; far camera module, remote camera heads, interior sensing camera, radars, thermal sensing, and domain controllers; interior and exterior mirrors, camera monitoring system driver/occupant monitoring systems, and smart actuators; forward and rear lighting, and lit grilles/panels/displays; latching system, door modules, charge port doors, power system, hinges, and door handles; and modular and textile folding roofs, and hard and soft tops. The Seating Systems segment provides seat structures, mechanism and hardware solutions, and foam and trim products. The Complete Vehicles segment offers vehicle engineering and manufacturing services. Magna International Inc. was founded in 1957 and is headquartered in Aurora, Canada.