Leggett & Platt (NYSE: LEG) and Kimball International (NASDAQ:KBAL) are both consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, dividends, valuation and analyst recommendations.

Dividends

Leggett & Platt pays an annual dividend of $1.44 per share and has a dividend yield of 3.5%. Kimball International pays an annual dividend of $0.28 per share and has a dividend yield of 1.7%. Leggett & Platt pays out 58.5% of its earnings in the form of a dividend. Leggett & Platt has increased its dividend for 46 consecutive years. Leggett & Platt is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings & Valuation

This table compares Leggett & Platt and Kimball International’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Leggett & Platt $3.94 billion 1.38 $292.60 million $2.46 16.69
Kimball International $669.93 million 0.92 $37.50 million N/A N/A

Leggett & Platt has higher revenue and earnings than Kimball International.

Analyst Ratings

This is a breakdown of recent ratings for Leggett & Platt and Kimball International, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Leggett & Platt 0 3 3 0 2.50
Kimball International 0 0 0 0 N/A

Leggett & Platt presently has a consensus price target of $53.20, indicating a potential upside of 29.60%. Given Leggett & Platt’s higher probable upside, research analysts plainly believe Leggett & Platt is more favorable than Kimball International.

Profitability

This table compares Leggett & Platt and Kimball International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Leggett & Platt 7.42% 29.44% 10.12%
Kimball International 5.41% 22.51% 13.01%

Institutional & Insider Ownership

73.5% of Leggett & Platt shares are owned by institutional investors. Comparatively, 61.9% of Kimball International shares are owned by institutional investors. 1.5% of Leggett & Platt shares are owned by company insiders. Comparatively, 2.7% of Kimball International shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk and Volatility

Leggett & Platt has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500. Comparatively, Kimball International has a beta of 1.55, suggesting that its share price is 55% more volatile than the S&P 500.

Summary

Leggett & Platt beats Kimball International on 11 of the 15 factors compared between the two stocks.

About Leggett & Platt

Leggett & Platt, Incorporated designs and produces various engineered components and products worldwide. It operates through four segments: Residential Products, Furniture Products, Industrial Products, and Specialized Products. The Residential Products segment offers innersprings, wire forms, and machines to shape wire into various types of springs; industrial sewing/finishing machines, conveyor lines, mattress packaging, and glue-drying equipment, as well as quilting machines; and structural fabrics, carpet cushions, and geo components. It serves manufacturers of finished bedding, upholstered furniture, packaging, filtration, and draperies; retailers and distributors of carpet cushions; and contractors, landscapers, road construction companies, and government agencies using geo components. The Furniture Products segment offers molded plywood components; bases, columns, back rests, control devices, and casters and frames; private-label finished furniture; beds and bed frames; adjustable beds; and steel mechanisms and hardware, and springs and seat suspensions. It serves upholstered and office furniture manufacturers; department stores and big box retailers; e-commerce retailers; and mattress and furniture retailers. The Industrial Products segment offers drawn wires, bedding and furniture components, automotive seat suspension systems, and steel rods. It serves packaging and baling companies, mechanical spring manufacturers, and wire distributors. The Specialized Products segment offers mechanical and pneumatic lumbar support and massage systems, seat suspension systems, motors and actuators, and cables; titanium, nickel, and stainless steel tubing, formed tube, and tube assemblies; and engineered hydraulic cylinders. It serves automobile and mobile equipment OEMs, and aerospace suppliers. The company sells its products through sales representatives and distributors. Leggett & Platt, Incorporated was founded in 1883 and is headquartered in Carthage, Missouri.

About Kimball International

Kimball International, Inc. manufactures and sells furniture products under the Kimball, National, and Kimball Hospitality brand names in the United States and internationally. The company provides office furniture, including desks, tables, seating, bookcases, and filing and storage units for federal, state, and local government offices, as well as other government related entities; and furniture solutions comprising headboards, tables, seating, vanities, and casegoods for hotel properties and mixed use developments. Its furniture solutions are used in collaborative and open work space areas, conference and meeting/huddle rooms, training rooms, private offices, learning areas, classrooms, lobby/reception areas, and dining/café areas with a mix of wood, metal, laminate, paint, fabric, solid surface, and plastic options. In addition, it offers patient room and lounge seating and casegoods for the healthcare market. The company markets and sells its products through sales representatives to end users, office furniture dealers, wholesalers, brokers, designers, purchasing companies, and catalog houses. The company was formerly known as The Jasper Corporation and changed its name to Kimball International, Inc. in July 1974. Kimball International, Inc. was incorporated in 1939 and is headquartered in Jasper, Indiana.

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