Head to Head Review: Daikin Industries (OTCMKTS:DKILY) versus MKS (NASDAQ:MKSI)

Daikin Industries (OTCMKTS:DKILY) and MKS (NASDAQ:MKSI) are both large-cap computer and technology companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, dividends, valuation, earnings and profitability.

Earnings and Valuation

This table compares Daikin Industries and MKS”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Daikin Industries	$31.21 billion	1.36	$1.75 billion	$0.62	23.37
MKS	$3.93 billion	4.78	$295.00 million	$4.37	63.93

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

Dividends

Daikin Industries pays an annual dividend of $0.14 per share and has a dividend yield of 1.0%. MKS pays an annual dividend of $1.00 per share and has a dividend yield of 0.4%. Daikin Industries pays out 22.6% of its earnings in the form of a dividend. MKS pays out 22.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Daikin Industries is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a summary of current ratings and price targets for Daikin Industries and MKS, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Daikin Industries	0	0	0	0	0.00
MKS	1	2	11	1	2.80

MKS has a consensus target price of $280.77, suggesting a potential upside of 0.50%. Given MKS’s stronger consensus rating and higher probable upside, analysts clearly believe MKS is more favorable than Daikin Industries.

Volatility & Risk

Daikin Industries has a beta of 0.87, meaning that its stock price is 13% less volatile than the S&P 500. Comparatively, MKS has a beta of 1.9, meaning that its stock price is 90% more volatile than the S&P 500.

Institutional & Insider Ownership

99.8% of MKS shares are owned by institutional investors. 0.6% of MKS shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Daikin Industries and MKS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Daikin Industries	5.69%	9.00%	5.07%
MKS	7.53%	20.85%	6.10%

Summary

MKS beats Daikin Industries on 13 of the 17 factors compared between the two stocks.

About Daikin Industries

Daikin Industries,Ltd. manufactures, distributes, and sells air-conditioning and refrigeration equipment, and chemical products in Japan, the Americas, China, Asia, Europe, Europe, and internationally. The company’s air-conditioning and refrigeration equipment products include room air-conditioning systems; air purifiers; heat-pump hot-water supply and room-heating systems; packaged air-conditioning systems; multiple air-conditioning systems for office buildings; air-conditioning systems for facilities and plants; heat reclaim ventilators; freezers; water chillers; turbo refrigerator equipment; air-handling units; air filters; industrial dust collectors; marine-type container refrigeration; and refrigerating and freezing showcases. The company’s chemical products comprising fluorocarbons, fluoroplastics, fluoroelastomers, fluoropaints, fluoro coating agents, semiconductor-etching products, water and oil repellent agents, pharmaceuticals and intermediates, and dry air suppliers. It also provides oil hydraulics products, including oil hydraulic pumps and valves, cooling equipment and systems, inverter-controlled pump motors, hydrostatic transmissions, and centralized lubrication units and systems; and defense products consisting of warheads, warhead parts for guided missiles, and home-use oxygen therapy equipment. In addition, the company offers after sales services. Daikin Industries,Ltd. was founded in 1924 and is headquartered in Osaka, Japan.

About MKS

MKS Instruments, Inc. provides foundational technology solutions to semiconductor manufacturing, electronics and packaging, and specialty industrial applications in the United States, Germany, China, South Korea, and internationally. It operates through Vacuum Solutions Division (VSD), Photonics Solutions Division (PSD), and Material Solutions Division (MSD) segments. The VSD segment provides foundational technology solutions, including pressure measurement and control, flow measurement and control, gas and vapor delivery, gas composition analysis, electronic control technology, reactive gas generation and delivery, power generation and delivery, and vacuum technology. The PSD segment offers range of solutions, which include lasers, beam measurement and profiling, precision motion control, vibration isolation systems, photonics instruments, temperature sensing, opto-mechanical components, optical elements, systems for flexible PCB laser processing, and laser-based systems, as well as high density interconnect PCB and package manufacturing. The MSD segment develops, process, and manufactures technologies comprising advanced surface modification, electroless and electrolytic plating, and surface finishing for chemistry, equipment, software, and services markets, as well as high-technology applications. In addition, the company sells its products and services through direct sales, network of independent distributors, and sales representatives, as well as websites, including product catalogs. The company was incorporated in 1961 and is headquartered in Andover, Massachusetts.