Contrasting Gentex (NASDAQ:GNTX) & American Axle & Manufacturing (NYSE:DCH)

American Axle & Manufacturing (NYSE:DCH) and Gentex (NASDAQ:GNTX) are both consumer discretionary companies, but which is the better stock? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, valuation, analyst recommendations and dividends.

Earnings and Valuation

This table compares American Axle & Manufacturing and Gentex”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
American Axle & Manufacturing	$8.22 billion	0.15	-$19.70 million	($1.08)	-4.72
Gentex	$2.63 billion	1.71	$384.84 million	$1.89	11.17

Gentex has lower revenue, but higher earnings than American Axle & Manufacturing. American Axle & Manufacturing is trading at a lower price-to-earnings ratio than Gentex, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

American Axle & Manufacturing has a beta of 1.69, suggesting that its share price is 69% more volatile than the S&P 500. Comparatively, Gentex has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for American Axle & Manufacturing and Gentex, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
American Axle & Manufacturing	2	5	4	0	2.18
Gentex	1	5	1	0	2.00

American Axle & Manufacturing presently has a consensus target price of $9.01, indicating a potential upside of 76.86%. Gentex has a consensus target price of $25.20, indicating a potential upside of 19.37%. Given American Axle & Manufacturing’s stronger consensus rating and higher probable upside, equities analysts plainly believe American Axle & Manufacturing is more favorable than Gentex.

Institutional and Insider Ownership

91.4% of American Axle & Manufacturing shares are owned by institutional investors. Comparatively, 86.8% of Gentex shares are owned by institutional investors. 2.1% of American Axle & Manufacturing shares are owned by company insiders. Comparatively, 0.5% of Gentex shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares American Axle & Manufacturing and Gentex’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
American Axle & Manufacturing	-2.01%	15.94%	2.03%
Gentex	15.50%	16.78%	14.18%

About American Axle & Manufacturing

American Axle & Manufacturing Holdings, Inc. is a leading supplier of driveline and drivetrain systems, modules and components for the light vehicle market world wide. It manufactures Driveline and Metal Forming technologies to support electric, hybrid and internal combustion vehicles. It’s the primary supplier of driveline components to its major customers include General Motors, Stellantis and Ford. It also sells various products to Ford & Stellantis from Metal Forming segment. It has the 2 operating segments. Driveline segment comprises front & rear axles, driveshafts, differential assemblies, clutch modules, balance shaft systems, disconnecting driveline technology, and electric & hybrid driveline products and systems for light trucks, SUVs, crossover vehicles, passenger cars and commercial vehicles. Metal Forming segment comprises axle & transmission shafts, ring and pinion gears, differential gears & assemblies, connecting rods and variable valve timing products for OEM and Tier 1 automotive suppliers.

About Gentex

Gentex Corporation designs, develops, manufactures, markets, and supplies digital vision, connected car, dimmable glass, and fire protection products in the United States, Germany, Japan, Mexico, Republic of Korea, and internationally. It operates through Automotive Products and Other segments. The company offers automotive products, including interior and exterior electrochromic automatic-dimming rearview mirrors, automotive electronics, and non-automatic-dimming rearview mirrors for automotive passenger cars, light trucks, pick-up trucks, sport utility vehicles, and vans for original equipment manufacturers, automotive suppliers, and various aftermarket and accessory customers. It also provides variable dimmable windows to aircraft manufacturers and airline operators. In addition, the company offers photoelectric smoke detectors and alarms, electrochemical carbon monoxide alarms and detectors, audible and visual signaling alarms, and bells and speakers used in fire detection systems in office buildings, hotels, and other commercial and residential buildings, as well as researches and develops nanofiber chemical sensing products. It sells its fire protection products directly, as well as through sales managers and manufacturer representative organizations to fire protection and security product distributors, electrical wholesale houses, and original equipment manufacturers of fire protection systems. Gentex Corporation was incorporated in 1974 and is headquartered in Zeeland, Michigan.