Comparing Denso (OTCMKTS:DNZOY) & Visteon (NASDAQ:VC)

Visteon (NASDAQ:VC) and Denso (OTCMKTS:DNZOY) are both consumer discretionary companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, valuation, institutional ownership, risk, earnings, dividends and profitability.

Earnings and Valuation

This table compares Visteon and Denso”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Visteon	$3.77 billion	0.67	$201.00 million	$7.65	12.37
Denso	$50.09 billion	0.70	$2.93 billion	$1.03	11.75

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

Insider and Institutional Ownership

99.7% of Visteon shares are owned by institutional investors. 2.0% of Visteon shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Dividends

Visteon pays an annual dividend of $1.50 per share and has a dividend yield of 1.6%. Denso pays an annual dividend of $0.26 per share and has a dividend yield of 2.1%. Visteon pays out 19.6% of its earnings in the form of a dividend. Denso pays out 25.2% 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.

Profitability

This table compares Visteon and Denso’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Visteon	5.58%	14.61%	7.07%
Denso	5.59%	7.85%	4.96%

Analyst Ratings

This is a summary of current ratings and recommmendations for Visteon and Denso, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Visteon	0	5	8	0	2.62
Denso	1	2	0	0	1.67

Visteon presently has a consensus price target of $132.18, indicating a potential upside of 39.71%. Given Visteon’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Visteon is more favorable than Denso.

Risk & Volatility

Visteon has a beta of 1.3, suggesting that its stock price is 30% more volatile than the S&P 500. Comparatively, Denso has a beta of 0.94, suggesting that its stock price is 6% less volatile than the S&P 500.

Summary

Visteon beats Denso on 11 of the 16 factors compared between the two stocks.

About Visteon

Visteon Corporation, an automotive technology company, designs, manufactures, and sells automotive electronics and connected car solutions for vehicle manufacturers worldwide. The company provides instrument clusters, including analog gauge clusters for 2-D and 3-D display-based devices; information displays that integrate a range of user interface technologies and graphics management capabilities, such as active privacy, TrueColor enhancement, local dimming, cameras, optics, haptic feedback, and light effects; and infotainment and connected car solutions, including scalable Android infotainment for seamless connectivity, as well as onboard artificial intelligence-based voice assistants with natural language understanding. It offers wired and wireless battery management systems; power electronics units; and telematics control units to enable secure connected car services, software updates, and data. In addition, the company provides SmartCore, an automotive-grade, integrated domain controller; SmartCore Runtime, a middleware enabling communication between domains and apps to be shown on any display; SmartCore Studio, a PC-based configuration tool to generate hypervisor configurations; and body domain modules, which integrate various functions, such as central gateway, body controls, comfort, and vehicle access solutions, into one device. Visteon Corporation was incorporated in 2000 and is headquartered in Van Buren, Michigan.

About Denso

DENSO Corporation engages in the manufacture and sale of automotive parts in Japan, rest of Asia, North America, Europe, and internationally. The company offers air-conditioning systems, including thermal management heat pump system, heat pump air-conditioning systems, refrigerant products, personal heating and cooling devices, air quality system, heat exchangers, bus air-conditioning systems, automotive freezers, and cooling products, as well as heating, ventilation, and air-conditioning units. It also provides gasoline, diesel, hybrid, electric vehicle, and fuel cell vehicle power-train systems; and safety and cockpit systems, such as driving environment recognition, vehicle dynamic control, collision safety, visibility support, cockpit information, and information security systems, as well as other products. In addition, the company offers automotive service parts and accessories, comprising spark plugs, oil and cabin air filters, wiper blades, air filter elements, starters, alternators, compressors, oxygen sensors, fuel pumps, air conditioner service parts, radiators, condensers, ion generators, air conditioners for busses and construction vehicles, and truck refrigeration products, as well as refrigerant recovery, recycling, and charging machines; and repair and support products and services. Further, it provides industrial solutions for factories in automotive parts production; agricultural solutions, including Profarm Controller, a climate control system for greenhouse and horticulture solutions; and household air conditioning equipment and industrial systems. The company was incorporated in 1949 and is headquartered in Kariya, Japan.