Comparing Hitachi (OTCMKTS:HTHIY) and Griffon (NYSE:GFF)

Hitachi (OTCMKTS:HTHIY) and Griffon (NYSE:GFF) are both multi-sector conglomerates companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, dividends, risk, profitability, analyst recommendations and institutional ownership.

Profitability

This table compares Hitachi and Griffon’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hitachi	7.64%	12.68%	5.68%
Griffon	0.31%	298.42%	12.31%

Dividends

Hitachi pays an annual dividend of $0.23 per share and has a dividend yield of 0.7%. Griffon pays an annual dividend of $0.88 per share and has a dividend yield of 1.0%. Hitachi pays out 19.5% of its earnings in the form of a dividend. Griffon pays out 676.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Griffon has increased its dividend for 1 consecutive years. Griffon is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Risk and Volatility

Hitachi has a beta of 0.91, indicating that its stock price is 9% less volatile than the S&P 500. Comparatively, Griffon has a beta of 1.46, indicating that its stock price is 46% more volatile than the S&P 500.

Insider and Institutional Ownership

0.3% of Hitachi shares are held by institutional investors. Comparatively, 73.2% of Griffon shares are held by institutional investors. 10.2% of Griffon shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings and price targets for Hitachi and Griffon, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hitachi	0	2	0	1	2.67
Griffon	1	1	2	1	2.60

Griffon has a consensus target price of $115.00, indicating a potential upside of 33.33%. Given Griffon’s higher probable upside, analysts plainly believe Griffon is more favorable than Hitachi.

Valuation & Earnings

This table compares Hitachi and Griffon”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hitachi	$70.33 billion	2.03	$5.33 billion	$1.18	26.64
Griffon	$2.52 billion	1.57	$51.11 million	$0.13	663.48

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

Summary

Griffon beats Hitachi on 10 of the 17 factors compared between the two stocks.

About Hitachi

Hitachi, Ltd. provides digital system and services, green energy and mobility, and connective industry solutions in Japan and internationally. It operates through seven segments: Digital Systems & Services, Green Energy & Mobility, Connective Industries, Automotive System, Hitachi Construction Machinery, Hitachi Metals, and Others. The company offers system integration, consulting, cloud services, storage, servers, and ATMs; finance solutions, social infrastructure information systems, government and public corporation information system, big data and AI, and IoT and data management; and IT products. It also operates power grids, nuclear and clear energy, renewable energy; provides energy management services and distributed power source solutions; semiconductors; elevators and escalators; air conditioners; industrial equipment; and railway systems. In addition, the company offers medical equipment for radiation therapy, In-vitro diagnosis, and regenerative medicines; automotive systems; home appliances; and water treatment solutions for water supply and sewage infrastructure, industrial water treatment, seawater desalination, and water recycling, as well as maintenance and repair services. Further, it hydraulic excavators, wheel loaders, mining machinery, construction solutions, and mine management systems. Additionally, the company offers specialty steel, functional components and equipment, power electronic and magnetic materials, wires, and cable and related products; optical disk drives; and property management services. Hitachi, Ltd. was founded in 1910 and is headquartered in Tokyo, Japan.

About Griffon

Griffon Corporation, through its subsidiaries, provides consumer and professional, and home and building products in the United States, Europe, Canada, Australia, and internationally. The company operates through two segments: Home and Building Products, and Consumer and Professional Products. The Home and Building Products segment manufactures and markets residential and commercial sectional garage doors, rolling steel service doors, fire doors, shutters, steel security grilles, and room dividers for the use in commercial construction and repair, and home remodeling applications. The segment also sells related products, such as garage door openers. The Consumer and Professional Products segment manufactures and markets long-handled engineered tools, including spades, hoes, cultivators, weeders, post hole diggers, scrapers, edgers and forks; wheelbarrows and lawn carts; snow tools comprising pushers, roof rakes, sled sleigh shovels, scoops, and ice scrapers; and pruning products, such as pruners, loppers, shears, and other tools. The segment also offers striking tools, including axes, picks, mattocks, mauls, wood splitters, sledgehammers, pry bars, and repair handles; traditional and gardening hand tools comprising hammers, screwdrivers, pliers, adjustable wrenches, handsaws, tape measures, levels, clamps, trowels, cultivators, weeders, and other hand tools; indoor and outdoor planters and lawn accessories; and garden hoses and hose reels. In addition, the segment provides home organization products, including wire and wood shelving, containers, storage cabinets, and other closet and home organization accessories; residential, industrial, and commercial fans; and cleaning products, such as brooms, brushes, squeegees, and other cleaning products. The company was formerly known as Instrument Systems Corporation and changed its name to Griffon Corporation in June 1992. Griffon Corporation was founded in 1774 and is headquartered in New York, New York.