Critical Contrast: WEG (WEGZY) vs. Its Rivals

WEG (OTCMKTS:WEGZY) is one of 436 publicly-traded companies in the “Machinery” industry, but how does it compare to its competitors? We will compare WEG to similar companies based on the strength of its institutional ownership, analyst recommendations, valuation, profitability, earnings, dividends and risk.

Earnings and Valuation

This table compares WEG and its competitors gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
WEG	$7.31 billion	$1.14 billion	30.86
WEG Competitors	$4.63 billion	$364.05 million	3.85

WEG has higher revenue and earnings than its competitors. WEG 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.

Dividends

WEG pays an annual dividend of $0.05 per share and has a dividend yield of 0.6%. WEG pays out 17.2% 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.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
WEG	15.39%	32.99%	14.37%
WEG Competitors	-1,044.47%	-15.02%	0.57%

Analyst Recommendations

This is a summary of current ratings for WEG and its competitors, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
WEG	0	1	2	0	2.67
WEG Competitors	4194	14689	18187	804	2.41

As a group, “Machinery” companies have a potential upside of 31.36%. Given WEG’s competitors higher probable upside, analysts plainly believe WEG has less favorable growth aspects than its competitors.

Institutional & Insider Ownership

51.7% of shares of all “Machinery” companies are owned by institutional investors. 14.3% of shares of all “Machinery” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

WEG beats its competitors on 9 of the 14 factors compared.

WEG Company Profile

WEG S.A. engages in the production and sale of capital goods in Brazil and internationally. The company offers electric motors, generators, and transformers; gear units and geared motors; hydraulic and steam turbines; frequency converters; motor starters and maneuver devices; control and protection of electric circuits for industrial automation; power sockets and switches; and electric traction solutions for heavy vehicles, SUV vehicles, locomotives, and sea transportation capital goods. It also provides solutions for the generation of renewable and distributed energy through hydro, thermal, biomass, wind, and solar energy power plants; solutions for industry; UPSs and alternators for groups of generators; conventional and movable electric substations; industrial electrical and electronic systems; industrial paint and varnish; and paints for automotive repainting. WEG S.A. was founded in 1961 and is headquartered in Jaraguá do Sul, Brazil.