Comparing Nidec (NJDCY) & Generac (GNRC)

Nidec (OTCMKTS: NJDCY) and Generac (NYSE:GNRC) are both computer and technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, profitability, institutional ownership, analyst recommendations, risk, earnings and dividends.

Insider and Institutional Ownership

0.1% of Nidec shares are held by institutional investors. 3.0% of Generac shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.



Profitability

This table compares Nidec and Generac’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nidec 8.69% 13.81% 7.11%
Generac 9.53% 45.26% 10.95%

Risk & Volatility

Nidec has a beta of 1.11, suggesting that its share price is 11% more volatile than the S&P 500. Comparatively, Generac has a beta of 1.55, suggesting that its share price is 55% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Nidec and Generac, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nidec 0 1 1 0 2.50
Generac 1 4 4 0 2.33

Nidec currently has a consensus price target of $16.00, indicating a potential downside of 58.55%. Generac has a consensus price target of $51.83, indicating a potential upside of 12.12%. Given Generac’s higher probable upside, analysts clearly believe Generac is more favorable than Nidec.

Dividends

Nidec pays an annual dividend of $0.09 per share and has a dividend yield of 0.2%. Generac does not pay a dividend. Nidec pays out 10.3% of its earnings in the form of a dividend.

Earnings and Valuation

This table compares Nidec and Generac’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nidec $11.09 billion 4.12 $1.04 billion $0.87 44.37
Generac $1.67 billion 1.72 $160.29 million $3.40 13.60

Nidec has higher revenue and earnings than Generac. Generac is trading at a lower price-to-earnings ratio than Nidec, indicating that it is currently the more affordable of the two stocks.

Summary

Generac beats Nidec on 9 of the 16 factors compared between the two stocks.

About Nidec

Nidec Corporation manufactures and sells motors and other electronic products worldwide. It offers brushless DC, brush DC, induction, SR, synchronous, servo, and stepping motors, as well as drive circuits; fans and blowers, such as DC axial flow, DC blower, and AC axial flow fans; and machinery, including inspection and measuring systems, automation units, control equipment, marking devices, and optical devices. The company also provides electronic and optical components comprising mechanical system components, optical system units, sensors, and electronic system components; automotive components; hard disk drive components; and other products that include music boxes and pottery craftwork equipment. In addition, it offers hotel services and sells private label products. The company's products have applications in the IT equipment, home appliances, audio and visual equipment, office equipment, healthcare and medical care, industrial equipment, and vehicle/robot industries. Nidec Corporation was founded in 1973 and is headquartered in Kyoto, Japan.

About Generac

Generac Holdings Inc. (Generac) is a designer and manufacturer of power generation equipment and other engine powered products. The Company serves the residential, light commercial, industrial, oil and gas, and construction markets. Its segments include Domestic and International. The Domestic segment includes the Generac business. The International segment includes the Ottomotores UK, Tower Light SRL and PR Industrial S.r.l acquisitions. It designs and manufactures light towers, which provide temporary lighting for various end markets; commercial and industrial mobile heaters used in the oil and gas, construction and other industrial markets, and a product line of outdoor power equipment for residential and commercial use. It designs, manufactures, sources and modifies engines, alternators, transfer switches and other components necessary for its products. It classifies products into three categories: Residential products, Commercial & Industrial products, and Other products.

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