Critical Comparison: Atlas Copco (OTCMKTS:ATLKY) versus Graham (NYSE:GHM)

Atlas Copco (OTCMKTS:ATLKY) and Graham (NYSE:GHM) are both industrials companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, earnings, analyst recommendations, profitability and valuation.

Insider & Institutional Ownership

0.0% of Atlas Copco shares are owned by institutional investors. Comparatively, 69.5% of Graham shares are owned by institutional investors. 6.0% of Graham shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Volatility & Risk

Atlas Copco has a beta of 1.41, indicating that its share price is 41% more volatile than the S&P 500. Comparatively, Graham has a beta of 0.9, indicating that its share price is 10% less volatile than the S&P 500.

Profitability

This table compares Atlas Copco and Graham’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Atlas Copco	15.70%	24.94%	13.21%
Graham	6.28%	13.26%	6.07%

Analyst Ratings

This is a summary of recent recommendations and price targets for Atlas Copco and Graham, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Atlas Copco	1	4	4	0	2.33
Graham	0	3	3	0	2.50

Graham has a consensus price target of $81.67, indicating a potential downside of 4.47%. Given Graham’s stronger consensus rating and higher possible upside, analysts clearly believe Graham is more favorable than Atlas Copco.

Valuation & Earnings

This table compares Atlas Copco and Graham”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Atlas Copco	$17.21 billion	4.95	$2.70 billion	$0.55	31.76
Graham	$209.90 million	4.51	$12.23 million	$1.35	63.32

Atlas Copco has higher revenue and earnings than Graham. Atlas Copco is trading at a lower price-to-earnings ratio than Graham, indicating that it is currently the more affordable of the two stocks.

Summary

Atlas Copco beats Graham on 8 of the 14 factors compared between the two stocks.

About Atlas Copco

Atlas Copco AB provides compressed air and gas, vacuum, energy, dewatering and industrial pump, industrial power tool, and assembly and machine vision solutions in North America, South America, Europe, Africa, the Middle East, Asia, and Oceania. It operates through Compressor Technique, Vacuum Technique, Industrial Technique, and Power Technique segments. The company offers piston compressors, oil-free tooth and scroll compressors, rotary screw compressors, oil-free blowers, oil-free centrifugal compressors, gas and process compressors, air and gas treatment equipment, expanders and pumps, and medical air solutions. It also provides oil-sealed rotary vane, dry, and liquid ring vacuum pumps; turbomolecular and cryogenic pumps; abatement and integrated systems; industrial assembly tools and solutions; self-pierce riveting solutions; adhesive dispensing and flow drill fastening equipment; material removal tools, and drills and other pneumatic products; machine vision solutions; construction and demolition tools; mobile compressors, generators, and energy storage systems; and industrial flow, portable power, portable flow, and portable air products, as well as specialty rental services. The company serves the semiconductor and flat panel, industrial manufacturing, civil engineering, demolition, exploration drilling, automotive, off-highway vehicles, electronics, aerospace, energy, food, pharmaceutical, textile, and other industries. Atlas Copco AB was founded in 1873 and is headquartered in Nacka, Sweden.

About Graham

Graham Corporation, together with its subsidiaries, designs and manufactures fluid, power, heat transfer, and vacuum equipment for chemical and petrochemical processing, defense, space, petroleum refining, cryogenic, energy, and other industries. It offers power plant systems, including ejectors and surface condensers; torpedo ejection, propulsion, and power systems, such as turbines, alternators, regulators, pumps, and blowers; and thermal management systems comprising pumps, blowers, and drive electronics for defense sector. The company also provides rocket propulsion systems consisting of turbopumps and fuel pumps; cooling systems, which include pumps, compressors, fans, and blowers; and life support systems that comprise fans, pumps, and blowers for space industry. In addition, it offers heat transfer and vacuum systems, including ejectors, process and surface condensers, liquid ring pumps, heat exchangers, and nozzles; power generation systems, such as turbines, generators, compressors, and pumps; and thermal management systems comprising pumps, blowers, and electronics for energy sector. Further, the company offers heat transfer and vacuum systems consisting of ejectors, process and surface condensers, liquid ring pumps, heat exchangers, and nozzles for chemical and petrochemical processing industry. The company also services and sells spare parts for its equipment. It sells its products directly in the United States, the Middle East, Canada, Asia, South America, and internationally. Graham Corporation was founded in 1936 and is headquartered in Batavia, New York.