Analyzing Dorman Products (DORM) and Strattec Security Corporation (STRT)
Dorman Products (NASDAQ: DORM) and Strattec Security Corporation (NASDAQ:STRT) are both auto/tires/trucks companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, institutional ownership, valuation, risk, analyst recommendations, earnings and profitability.
Insider & Institutional Ownership
75.9% of Dorman Products shares are held by institutional investors. Comparatively, 85.5% of Strattec Security Corporation shares are held by institutional investors. 11.7% of Dorman Products shares are held by company insiders. Comparatively, 6.8% of Strattec Security Corporation shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
This is a summary of recent ratings for Dorman Products and Strattec Security Corporation, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Strattec Security Corporation||0||0||0||0||N/A|
Dorman Products presently has a consensus price target of $78.00, indicating a potential upside of 17.66%. Given Dorman Products’ higher probable upside, analysts plainly believe Dorman Products is more favorable than Strattec Security Corporation.
This table compares Dorman Products and Strattec Security Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Strattec Security Corporation||1.72%||4.53%||2.86%|
Volatility & Risk
Dorman Products has a beta of 0.61, indicating that its share price is 39% less volatile than the S&P 500. Comparatively, Strattec Security Corporation has a beta of 1.51, indicating that its share price is 51% more volatile than the S&P 500.
Earnings and Valuation
This table compares Dorman Products and Strattec Security Corporation’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Dorman Products||$892.77 million||2.52||$197.74 million||$3.28||20.21|
|Strattec Security Corporation||$417.33 million||0.29||$25.12 million||$1.96||16.99|
Dorman Products has higher revenue and earnings than Strattec Security Corporation. Strattec Security Corporation is trading at a lower price-to-earnings ratio than Dorman Products, indicating that it is currently the more affordable of the two stocks.
Strattec Security Corporation pays an annual dividend of $0.56 per share and has a dividend yield of 1.7%. Dorman Products does not pay a dividend. Strattec Security Corporation pays out 28.6% of its earnings in the form of a dividend.
Dorman Products beats Strattec Security Corporation on 11 of the 14 factors compared between the two stocks.
About Dorman Products
Dorman Products, Inc. is a supplier of replacement parts and fasteners for passenger cars, light trucks and heavy duty trucks in the automotive aftermarket. As of December 31, 2016, the Company distributed and marketed approximately 155,000 different stock keeping units (SKU’s) of automotive replacement parts and fasteners. As of December 31, 2016, approximately 83% of its products were sold under brands that it owned and the remainder of its products were sold for resale under customers’ private labels, other brands or in bulk. Its products are sold in the United States through automotive aftermarket retailers, national, regional and local warehouse distributors, and specialty markets, and salvage yards. It also distributes automotive replacement parts outside the United States, with sales primarily into Canada, Mexico, Europe, the Middle East, and Australia. Its parts are marketed under the OE Solutions, TECHoice, AutoGrade, Conduct-Tite, FirstStop and HD Solutions brand names.
About Strattec Security Corporation
Strattec Security Corporation designs, develops, manufactures and markets automotive access control products. The Company offers access control products, including mechanical locks and keys, electronically enhanced locks and keys, steering column and instrument panel ignition lock housings, latches, power sliding side door systems, power lift gate systems, power deck lid systems, door handles and related products for North American automotive customers. The Company supplies its products under the VAST brand name. The Company’s products are shipped to customer locations in the United States, Canada, Mexico, Europe, South America, Korea and China, and it also provides full service and aftermarket support. The Company provides its customers with engineered access control products, including locksets, fobs, push button ignition systems, steering column lock housings, seatback and secondary power liftgate systems, power decklids, door handles, and trim and other access products.
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