Deere & Company (NYSE:DE – Get Free Report) and Perma-Pipe International (NASDAQ:PPIH – Get Free Report) are both industrials companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, profitability, institutional ownership, dividends and earnings.
Institutional and Insider Ownership
68.6% of Deere & Company shares are owned by institutional investors. Comparatively, 28.4% of Perma-Pipe International shares are owned by institutional investors. 0.3% of Deere & Company shares are owned by company insiders. Comparatively, 1.1% of Perma-Pipe International shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Volatility and Risk
Deere & Company has a beta of 0.9, meaning that its share price is 10% less volatile than the S&P 500. Comparatively, Perma-Pipe International has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Deere & Company | 0 | 8 | 16 | 0 | 2.67 |
| Perma-Pipe International | 0 | 1 | 0 | 0 | 2.00 |
Deere & Company presently has a consensus target price of $680.73, suggesting a potential downside of 0.81%. Perma-Pipe International has a consensus target price of $36.00, suggesting a potential upside of 26.85%. Given Perma-Pipe International’s higher possible upside, analysts clearly believe Perma-Pipe International is more favorable than Deere & Company.
Profitability
This table compares Deere & Company and Perma-Pipe International’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Deere & Company | 10.16% | 18.10% | 4.60% |
| Perma-Pipe International | 6.47% | 15.92% | 6.57% |
Valuation and Earnings
This table compares Deere & Company and Perma-Pipe International”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Deere & Company | $45.68 billion | 4.05 | $5.03 billion | $18.00 | 38.13 |
| Perma-Pipe International | $210.93 million | 1.09 | $17.03 million | $1.69 | 16.79 |
Deere & Company has higher revenue and earnings than Perma-Pipe International. Perma-Pipe International is trading at a lower price-to-earnings ratio than Deere & Company, indicating that it is currently the more affordable of the two stocks.
Summary
Deere & Company beats Perma-Pipe International on 11 of the 14 factors compared between the two stocks.
About Deere & Company
Deere & Co. engages in the manufacture and distribution of equipment used in agriculture, construction, forestry, and turf care. It operates through the following segments: Agriculture and Turf, Construction and Forestry, and Financial Services. The Agriculture and Turf segment focuses on the distribution and manufacture of a full line of agriculture and turf equipment and related service parts. The Construction and Forestry segment offers machines and service parts used in construction, earthmoving, road building, material handling and timber harvesting. The Financial Services segment finances sales and leases by John Deere dealers of new and used agriculture and turf equipment and construction and forestry equipment. The company was founded by John Deere in 1837 and is headquartered in Moline, IL.
About Perma-Pipe International
Perma-Pipe International Holdings, Inc., together with its subsidiaries, engineers, designs, manufactures, and sells specialty piping and leak detection systems. It offers insulated and jacketed district heating and cooling piping systems for energy distribution from central energy plants to various locations; and primary and secondary containment piping systems for transporting chemicals, hazardous fluids, and petroleum products, as well as engages in the coating and insulation of oil and gas gathering and transmission pipelines. The company also offers liquid and powder based anti-corrosion coatings for external and internal surfaces of steel pipe, including shapes like bends, reducers, tees, and other spools/fittings that is used in pipelines for the transportation of oil and gas products and potable water. It has operations in the United States, Canada, the Middle East, North Africa, Europe, India, and internationally. The company was formerly known as MFRI, Inc. and changed its name to Perma-Pipe International Holdings, Inc. in March 2017. Perma-Pipe International Holdings, Inc. was incorporated in 1993 and is headquartered in Spring, Texas.
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