Contrasting Harley-Davidson (NYSE:HOG) & Mazda Motor (OTCMKTS:MZDAY)

Mazda Motor (OTCMKTS:MZDAY) and Harley-Davidson (NYSE:HOG) are both mid-cap consumer discretionary companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, valuation, profitability, risk and dividends.

Insider and Institutional Ownership

85.1% of Harley-Davidson shares are owned by institutional investors. 1.0% of Harley-Davidson shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares Mazda Motor and Harley-Davidson”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mazda Motor	$32.67 billion	0.13	$231.57 million	$0.54	6.27
Harley-Davidson	$4.47 billion	0.61	$338.74 million	$1.63	16.04

Harley-Davidson has lower revenue, but higher earnings than Mazda Motor. Mazda Motor is trading at a lower price-to-earnings ratio than Harley-Davidson, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Mazda Motor and Harley-Davidson’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mazda Motor	2.06%	9.13%	3.96%
Harley-Davidson	4.78%	6.28%	2.45%

Dividends

Mazda Motor pays an annual dividend of $0.11 per share and has a dividend yield of 3.2%. Harley-Davidson pays an annual dividend of $0.75 per share and has a dividend yield of 2.9%. Mazda Motor pays out 20.4% of its earnings in the form of a dividend. Harley-Davidson pays out 46.0% 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. Harley-Davidson has raised its dividend for 5 consecutive years. Mazda Motor is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

Mazda Motor has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500. Comparatively, Harley-Davidson has a beta of 1.3, meaning that its stock price is 30% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations for Mazda Motor and Harley-Davidson, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mazda Motor	0	3	0	0	2.00
Harley-Davidson	2	4	6	1	2.46

Harley-Davidson has a consensus target price of $28.20, suggesting a potential upside of 7.87%. Given Harley-Davidson’s stronger consensus rating and higher possible upside, analysts clearly believe Harley-Davidson is more favorable than Mazda Motor.

Summary

Harley-Davidson beats Mazda Motor on 13 of the 18 factors compared between the two stocks.

About Mazda Motor

Mazda Motor Corporation engages in the manufacture and sale of passenger cars and commercial vehicles in Japan, China, North America, Europe, and internationally. The company was formerly known as Toyo Kogyo Co., Ltd. and changed its name to Mazda Motor Corporation in May 1984. Mazda Motor Corporation was incorporated in 1920 and is headquartered in Hiroshima, Japan.

About Harley-Davidson

Harley-Davidson, Inc. manufactures and sells motorcycles in the United States and internationally. The company operates in three segments: Harley-Davidson Motor Company, LiveWire, and Harley-Davidson Financial Services. The Harley-Davidson Motor Company segment designs, manufactures, and sells motorcycles, including cruiser, trike, touring, standard, sportbike, adventure, and dual sport, as well as motorcycle parts, accessories, and apparel, as well as licenses its trademarks and related services. This segment sells its products to retail customers through a network of independent dealers, as well as e-commerce channels. The LiveWire segment sells electric motorcycles, balance bikes for kids, parts and accessories, apparel, and related parts and services. The Harley-Davidson Financial Services segment provides wholesale financing services, such as floorplan and open account financing of motorcycles, and parts and accessories; and retail financing services, such as installment lending for the purchase of new and used Harley-Davidson motorcycles, as well as point-of-sale insurance and voluntary protection products. This segment also licenses third-party financial institutions that issue credit cards bearing the Harley-Davidson brand. Harley-Davidson, Inc. was founded in 1903 and is based in Milwaukee, Wisconsin.