Fenix Parts (NASDAQ: FENX) and Horizon Global Corporation (NYSE:HZN) are both small-cap auto/tires/trucks companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.

Risk and Volatility

Fenix Parts has a beta of 1.06, suggesting that its share price is 6% more volatile than the S&P 500. Comparatively, Horizon Global Corporation has a beta of 1.87, suggesting that its share price is 87% more volatile than the S&P 500.

Profitability

This table compares Fenix Parts and Horizon Global Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Fenix Parts -3.40% -6.88% -3.58%
Horizon Global Corporation -1.45% 18.86% 2.76%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Fenix Parts and Horizon Global Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Fenix Parts 0 1 0 0 2.00
Horizon Global Corporation 0 3 4 0 2.57

Horizon Global Corporation has a consensus target price of $20.17, suggesting a potential upside of 15.83%. Given Horizon Global Corporation’s stronger consensus rating and higher possible upside, analysts plainly believe Horizon Global Corporation is more favorable than Fenix Parts.

Insider and Institutional Ownership

52.3% of Fenix Parts shares are held by institutional investors. Comparatively, 94.0% of Horizon Global Corporation shares are held by institutional investors. 16.6% of Fenix Parts shares are held by company insiders. Comparatively, 1.3% of Horizon Global 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.

Valuation and Earnings

This table compares Fenix Parts and Horizon Global Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Fenix Parts $132.10 million 0.12 -$4.71 million ($2.89) -0.28
Horizon Global Corporation $792.20 million 0.55 $58.76 million ($0.67) -25.98

Horizon Global Corporation has higher revenue and earnings than Fenix Parts. Horizon Global Corporation is trading at a lower price-to-earnings ratio than Fenix Parts, indicating that it is currently the more affordable of the two stocks.

Summary

Horizon Global Corporation beats Fenix Parts on 12 of the 13 factors compared between the two stocks.

Fenix Parts Company Profile

Fenix Parts, Inc. is engaged in auto recycling business. The Company recovers and resells original equipment manufacturer (OEM) parts, components and systems, such as engines, transmissions, radiators, trunks, lamps and seats reclaimed from damaged, totaled or low value vehicles. The Company operates through Automobile Recycling segment. The Company purchases its vehicles primarily at auto salvage auctions. Upon receipt of vehicles, the Company inventories and then dismantles the vehicles and sells the recycled components. Its customers include collision repair shops (body shops), mechanical repair shops, auto dealerships and individual retail customers. The Company also generates a portion of its revenue from the sale as scrap of the unusable parts and materials, from the sale of used cars and motorcycles, the sale of aftermarket parts, and from the sale of extended warranty contracts.

Horizon Global Corporation Company Profile

Horizon Global Corporation is a designer, manufacturer and distributor of a range of custom-engineered towing, trailering, cargo management and other products serving the automotive aftermarket, retail and original equipment (OE) channels. The Company operates through three segments: Horizon Americas, Horizon Asia-Pacific, and Horizon Europe-Africa. Its towing product category includes devices and accessories installed on a tow-vehicle for the purpose of attaching a trailer and camper, among others, such as hitches and other towing accessories. Its trailering product category includes control devices and components of the trailer itself, such as brake controls and brake replacement parts. Its cargo management product category includes a range of products used to facilitate the transportation of various forms of cargo, to secure that cargo or to organize items. Its other product category includes a range of items, such as tubular push bars, side steps, and commercial brooms and brushes.

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