Financial Review: Illinois Tool Works (NYSE:ITW) versus Hillman Solutions (NASDAQ:HLMN)

Hillman Solutions (NASDAQ:HLMN) and Illinois Tool Works (NYSE:ITW) are both industrials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, earnings, valuation, institutional ownership, analyst recommendations, dividends and profitability.

Volatility & Risk

Hillman Solutions has a beta of 1.38, suggesting that its share price is 38% more volatile than the S&P 500. Comparatively, Illinois Tool Works has a beta of 0.98, suggesting that its share price is 2% less volatile than the S&P 500.

Profitability

This table compares Hillman Solutions and Illinois Tool Works’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hillman Solutions	2.57%	9.11%	4.70%
Illinois Tool Works	19.39%	101.72%	19.64%

Analyst Recommendations

This is a summary of current ratings and recommmendations for Hillman Solutions and Illinois Tool Works, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hillman Solutions	1	1	2	0	2.25
Illinois Tool Works	5	6	2	0	1.77

Hillman Solutions currently has a consensus target price of $12.67, indicating a potential upside of 64.93%. Illinois Tool Works has a consensus target price of $281.25, indicating a potential upside of 4.17%. Given Hillman Solutions’ stronger consensus rating and higher possible upside, equities analysts clearly believe Hillman Solutions is more favorable than Illinois Tool Works.

Earnings and Valuation

This table compares Hillman Solutions and Illinois Tool Works”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hillman Solutions	$1.55 billion	0.96	$40.31 million	$0.22	34.91
Illinois Tool Works	$16.04 billion	4.79	$3.07 billion	$11.03	24.48

Illinois Tool Works has higher revenue and earnings than Hillman Solutions. Illinois Tool Works is trading at a lower price-to-earnings ratio than Hillman Solutions, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

98.1% of Hillman Solutions shares are owned by institutional investors. Comparatively, 79.8% of Illinois Tool Works shares are owned by institutional investors. 5.3% of Hillman Solutions shares are owned by insiders. Comparatively, 0.8% of Illinois Tool Works shares are owned by 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.

Summary

Illinois Tool Works beats Hillman Solutions on 7 of the 13 factors compared between the two stocks.

About Hillman Solutions

Founded in 1964 and headquartered in Cincinnati, Ohio, Hillman is a leading North American provider of complete hardware solutions, delivered with industry best customer service to over 40,000 locations. Hillman designs innovative product and merchandising solutions for complex categories that deliver an outstanding customer experience to home improvement centers, mass merchants, national and regional hardware stores, pet supply stores, and OEM & Industrial customers. Leveraging a world-class distribution and sales network, Hillman delivers a “small business” experience with “big business” efficiency.

About Illinois Tool Works

Illinois Tool Works Inc. manufactures and sells industrial products and equipment in the United States and internationally. It operates through seven segments: Automotive OEM; Food Equipment; Test & Measurement and Electronics; Welding; Polymers & Fluids; Construction Products; and Specialty Products. The Automotive OEM segment offers plastic and metal components, fasteners, and assemblies for automobiles, light trucks, and other industrial uses. The Food Equipment segment provides warewashing, refrigeration, cooking, and food processing equipment; kitchen exhaust, ventilation, and pollution control systems; and food equipment maintenance and repair services. The Test & Measurement and Electronics segment produces and sells equipment, consumables, and related software for testing and measuring of materials and structures, as well as equipment and consumables used in the production of electronic subassemblies and microelectronics. The Welding segment produces arc welding equipment; and metal arc welding consumables and related accessories. The Polymers & Fluids segment produces adhesives, sealants, lubrication and cutting fluids, and fluids and polymers for auto aftermarket maintenance and appearance. The Construction Products segment offers engineered fastening systems and solutions for the residential construction, renovation/remodel, and commercial construction markets. The Specialty Products segment provides beverage packaging equipment and consumables, product coding and marking equipment and consumables, and appliance components and fasteners. It serves the automotive OEM and tiers, MRO, commercial food equipment, construction, general industrial, industrial capital goods, consumer durables, automotive aftermarket end, and other markets. The company distributes its products directly to industrial manufacturers, as well as through independent distributors. Illinois Tool Works Inc. was founded in 1912 and is based in Glenview, Illinois.