Analyzing ATS (NYSE:ATS) & Applied Industrial Technologies (NYSE:AIT)

ATS (NYSE:ATS) and Applied Industrial Technologies (NYSE:AIT) are both industrials companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, profitability, dividends, risk and earnings.

Analyst Recommendations

This is a breakdown of current ratings and price targets for ATS and Applied Industrial Technologies, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ATS	1	2	2	0	2.20
Applied Industrial Technologies	0	1	5	0	2.83

ATS presently has a consensus target price of $35.00, suggesting a potential upside of 2.82%. Applied Industrial Technologies has a consensus target price of $295.00, suggesting a potential upside of 0.14%. Given ATS’s higher probable upside, equities research analysts clearly believe ATS is more favorable than Applied Industrial Technologies.

Volatility and Risk

ATS has a beta of 1.16, indicating that its share price is 16% more volatile than the S&P 500. Comparatively, Applied Industrial Technologies has a beta of 0.82, indicating that its share price is 18% less volatile than the S&P 500.

Valuation and Earnings

This table compares ATS and Applied Industrial Technologies”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ATS	$1.82 billion	1.83	-$20.16 million	$0.15	226.94
Applied Industrial Technologies	$4.56 billion	2.41	$392.99 million	$10.51	28.03

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

Insider and Institutional Ownership

75.8% of ATS shares are held by institutional investors. Comparatively, 93.5% of Applied Industrial Technologies shares are held by institutional investors. 1.6% of Applied Industrial Technologies shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares ATS and Applied Industrial Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ATS	0.77%	9.67%	3.74%
Applied Industrial Technologies	8.49%	21.74%	12.78%

Summary

Applied Industrial Technologies beats ATS on 11 of the 14 factors compared between the two stocks.

About ATS

ATS Corporation, together with its subsidiaries, provides automation solutions worldwide. The company is also involved in planning, designing, building, commissioning, and servicing automated manufacturing and assembly systems, including automation products and test solutions. In addition, it offers pre-automation services comprising discovery and analysis, concept development, simulation, and total cost of ownership modelling; post automation services, including training, process optimization, preventative maintenance, emergency and on-call support, spare parts, retooling, retrofits, and equipment relocation; and contract manufacturing services, as well as after sales and services. Further, the company provides engineering design, prototyping, process verification, specification writing, software and manufacturing process controls development, standard automation products/platforms, equipment design and build, third-party equipment qualification, procurement and integration, automation system installation, product line commissioning, validation, and documentation services. Additionally, it offers value engineering, supply chain management, and integration and manufacturing capabilities, as well as other automation products and solutions; and software and digital solutions comprising connected factory floor management systems to capture, analyze, and use real time machine performance data to troubleshoot, deliver process and product solutions, prevent equipment downtime, drive operational efficiency, and unlock performance for sustainable production improvements. ATS Corporation serves life sciences, transportation and mobility, consumer products, food and beverage, electronics, nuclear, packaging, warehousing and distribution, and energy markets. The company was formerly known as ATS Automation Tooling Systems Inc. and changed its name to ATS Corporation in November 2022. ATS Corporation was founded in 1978 and is headquartered in Cambridge, Canada.

About Applied Industrial Technologies

Applied Industrial Technologies, Inc. distributes industrial motion, power, control, and automation technology solutions in North America, Australia, New Zealand, and Singapore. It operates in two segments, Service Center Based Distribution, and Engineered Solutions. The company distributes bearings, power transmission products, engineered fluid power components and systems, specialty flow control solutions, advanced automation products, industrial rubber products, linear motion components, automation solutions, tools, safety products, oilfield supplies, and other industrial and maintenance supplies; and motors, belting, drives, couplings, pumps, hydraulic and pneumatic components, filtration supplies, valves, fittings, process instrumentation, actuators, and hoses, filtration supplies, as well as other related supplies for general operational needs of customers' machinery and equipment. It also operates fabricated rubber shops and service field crews that install, modify, and repair conveyor belts and rubber linings, as well as offer hose assemblies. In addition, the company provides technical support services; engages in the distribution of fluid power and industrial flow control products; advanced automation solutions, including machine vision, robotics, motion control, and smart technologies. It distributes industrial products through a network of service centers. The company serves various industries, including agriculture and food processing, cement, chemicals and petrochemicals, fabricated metals, forest products, industrial machinery and equipment, life sciences, mining, oil and gas, primary metals, technology, transportation, and utilities, as well as government entities. The company was formerly known as Bearings, Inc. and changed its to name to Applied Industrial Technologies, Inc. in 1997. The company was founded in 1923 and is headquartered in Cleveland, Ohio.