Contrasting Worthington Enterprises (NYSE:WOR) & AAON (NASDAQ:AAON)

Worthington Enterprises (NYSE:WOR) and AAON (NASDAQ:AAON) are both mid-cap industrials companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, profitability, valuation, risk, institutional ownership, earnings and analyst recommendations.

Dividends

Worthington Enterprises pays an annual dividend of $0.76 per share and has a dividend yield of 1.2%. AAON pays an annual dividend of $0.40 per share and has a dividend yield of 0.5%. Worthington Enterprises pays out 24.2% of its earnings in the form of a dividend. AAON pays out 20.8% 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. AAON has raised its dividend for 2 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings for Worthington Enterprises and AAON, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Worthington Enterprises	0	1	2	0	2.67
AAON	0	3	4	0	2.57

Worthington Enterprises currently has a consensus target price of $65.50, indicating a potential upside of 4.95%. AAON has a consensus target price of $126.67, indicating a potential upside of 59.53%. Given AAON’s higher probable upside, analysts plainly believe AAON is more favorable than Worthington Enterprises.

Profitability

This table compares Worthington Enterprises and AAON’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Worthington Enterprises	11.30%	16.79%	9.27%
AAON	8.24%	17.32%	9.33%

Institutional and Insider Ownership

51.6% of Worthington Enterprises shares are held by institutional investors. Comparatively, 70.8% of AAON shares are held by institutional investors. 2.5% of Worthington Enterprises shares are held by company insiders. Comparatively, 18.1% of AAON shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Risk and Volatility

Worthington Enterprises has a beta of 1.3, indicating that its stock price is 30% more volatile than the S&P 500. Comparatively, AAON has a beta of 1.41, indicating that its stock price is 41% more volatile than the S&P 500.

Earnings and Valuation

This table compares Worthington Enterprises and AAON”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Worthington Enterprises	$1.38 billion	2.21	$156.09 million	$3.14	19.88
AAON	$1.44 billion	4.54	$107.59 million	$1.92	41.35

Worthington Enterprises has higher earnings, but lower revenue than AAON. Worthington Enterprises is trading at a lower price-to-earnings ratio than AAON, indicating that it is currently the more affordable of the two stocks.

Summary

AAON beats Worthington Enterprises on 12 of the 17 factors compared between the two stocks.

About Worthington Enterprises

Worthington Enterprises, Inc. operates as an industrial manufacturing company. It operates through three segments: Building Products, Consumer Products, and Sustainable Energy Solutions. The Building Products segment sells refrigerant and LPG cylinders, well water and expansion tanks, fire suppression tanks, chemical tanks, and foam and adhesive tanks for gas producers, and distributors. The Consumer Products segment provides products in the tools, outdoor living, and celebrations end markets. Its products include propane-filled cylinders for torches, camping stoves and other applications, LPG cylinders, handheld torches, helium-filled balloon kits, specialized hand tools and instruments, and drywall tools and accessories This segment sells its products primarily to mass merchandisers, retailers, and distributors under the Coleman, Bernzomatic, Balloon Time, Mag-Torch, General, Garden-Weasel, Pactool International, Hawkeye, Worthington Pro Grade, and Level5 brands. The Sustainable Energy Solutions segment sells onboard fueling systems and services, as well as gas containment solutions and services for storage, transport, and distribution of industrial gases. It includes high pressure and acetylene cylinders for life support systems and alternative fuel cylinders used to hold CNG and hydrogen for automobiles, buses, and light-duty trucks. The company was formerly known as Worthington Industries, Inc. Worthington Enterprises, Inc. was founded in 1955 and is headquartered in Columbus, Ohio.

About AAON

AAON, Inc., together with its subsidiaries, engages in engineering, manufacturing, marketing, and selling air conditioning and heating equipment in the United States and Canada. The company operates through three segments: AAON Oklahoma, AAON Coil Products, and BASX. It offers rooftop units, data center cooling solutions, cleanroom systems, chillers, packaged outdoor mechanical rooms, air handling units, makeup air units, energy recovery units, condensing units, geothermal/water-source heat pumps, coils, and controls. The company markets and sells its products to retail, manufacturing, educational, lodging, supermarket, data centers, medical and pharmaceutical, and other commercial industries. It sells its products through a network of independent manufacturer representative organizations and internal sales force, as well as online. The company was incorporated in 1987 and is based in Tulsa, Oklahoma.