Critical Analysis: Douglas Dynamics (PLOW) and Its Rivals

Douglas Dynamics (NYSE:PLOW) is one of 436 public companies in the “Machinery” industry, but how does it contrast to its competitors? We will compare Douglas Dynamics to similar companies based on the strength of its risk, institutional ownership, analyst recommendations, dividends, earnings, profitability and valuation.

Dividends

Douglas Dynamics pays an annual dividend of $1.18 per share and has a dividend yield of 3.1%. Douglas Dynamics pays out 53.6% of its earnings in the form of a dividend. As a group, “Machinery” companies pay a dividend yield of 2.8% and pay out 24.6% of their earnings in the form of a dividend.

Valuation and Earnings

This table compares Douglas Dynamics and its competitors gross revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Douglas Dynamics	$656.05 million	$46.90 million	17.34
Douglas Dynamics Competitors	$4.64 billion	$364.05 million	3.93

Douglas Dynamics’ competitors have higher revenue and earnings than Douglas Dynamics. Douglas Dynamics is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Profitability

This table compares Douglas Dynamics and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Douglas Dynamics	8.71%	23.57%	10.23%
Douglas Dynamics Competitors	-1,044.42%	-14.99%	0.57%

Institutional and Insider Ownership

91.8% of Douglas Dynamics shares are owned by institutional investors. Comparatively, 51.7% of shares of all “Machinery” companies are owned by institutional investors. 1.5% of Douglas Dynamics shares are owned by company insiders. Comparatively, 14.2% of shares of all “Machinery” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Risk & Volatility

Douglas Dynamics has a beta of 1.14, meaning that its share price is 14% more volatile than the S&P 500. Comparatively, Douglas Dynamics’ competitors have a beta of 5.11, meaning that their average share price is 411% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations for Douglas Dynamics and its competitors, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Douglas Dynamics	0	2	2	1	2.80
Douglas Dynamics Competitors	4195	14693	18192	804	2.41

Douglas Dynamics presently has a consensus price target of $51.67, suggesting a potential upside of 35.44%. As a group, “Machinery” companies have a potential upside of 31.82%. Given Douglas Dynamics’ stronger consensus rating and higher possible upside, analysts plainly believe Douglas Dynamics is more favorable than its competitors.

Summary

Douglas Dynamics beats its competitors on 9 of the 15 factors compared.

About Douglas Dynamics

Douglas Dynamics, Inc. operates as a manufacturer and upfitter of commercial work truck attachments and equipment in North America. It operates through two segments, Work Truck Attachments and Work Truck Solutions. The Work Truck Attachments segment manufactures and sells snow and ice control attachments, including snowplows, and sand and salt spreaders for light trucks and heavy duty trucks, as well as various related parts and accessories. The Work Truck Solutions segment primarily manufactures municipal snow and ice control products; provides truck and vehicle upfits where it attaches component pieces of equipment, truck bodies, racking, and storage solutions to a vehicle chassis for use by end users for work related purposes; and manufactures storage solutions for trucks and vans, and cable pulling equipment for trucks. This segment also offers up-fit and storage solutions. It also provides customized turnkey solutions to governmental agencies, such as Departments of Transportation and municipalities. The company sells its products under the FISHER, SNOWEX, WESTERN, TURFEX, SWEEPEX, HENDERSON, BRINEXTREME, and DEJANA brands. It distributes its products primarily to professional snowplowers who are contracted to remove snow and ice from commercial and residential areas. The company was founded in 1948 and is headquartered in Milwaukee, Wisconsin.