Head-To-Head Review: Sumitomo Heavy (OTCMKTS:SOHVY) & Kawasaki Heavy Industries (OTCMKTS:KWHIY)

Sumitomo Heavy (OTCMKTS:SOHVY) and Kawasaki Heavy Industries (OTCMKTS:KWHIY) are both industrials companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, profitability, risk, dividends, institutional ownership and valuation.

Dividends

Sumitomo Heavy pays an annual dividend of $0.14 per share and has a dividend yield of 1.7%. Kawasaki Heavy Industries pays an annual dividend of $0.06 per share and has a dividend yield of 0.9%. Sumitomo Heavy pays out 30.4% of its earnings in the form of a dividend. Kawasaki Heavy Industries pays out 17.1% 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.

Earnings and Valuation

This table compares Sumitomo Heavy and Kawasaki Heavy Industries”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sumitomo Heavy	$7.14 billion	0.56	$207.28 million	$0.46	18.08
Kawasaki Heavy Industries	$15.35 billion	0.92	$713.84 million	$0.35	19.14

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

Risk & Volatility

Sumitomo Heavy has a beta of 0.39, suggesting that its share price is 61% less volatile than the S&P 500. Comparatively, Kawasaki Heavy Industries has a beta of 0.74, suggesting that its share price is 26% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings for Sumitomo Heavy and Kawasaki Heavy Industries, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sumitomo Heavy	0	0	0	0	0.00
Kawasaki Heavy Industries	0	2	0	0	2.00

Profitability

This table compares Sumitomo Heavy and Kawasaki Heavy Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sumitomo Heavy	2.98%	4.87%	2.49%
Kawasaki Heavy Industries	4.74%	13.40%	3.49%

Summary

Kawasaki Heavy Industries beats Sumitomo Heavy on 10 of the 12 factors compared between the two stocks.

About Sumitomo Heavy

Sumitomo Heavy Industries, Ltd. manufactures and sells general machinery, advanced precision machinery, construction machinery, ships, and environmental plant facilities in Japan and internationally. Its Mechatronics segment offers gearmotors, gearboxes, motion control drives, motors and inverters, drive solutions, precision positioning equipment, laser systems, control systems, motion components, and collaborative robot. The company's Industrial Machinery segment provides injection molding machines, cryocoolers, ion implanters, PET tracer production systems, vacuum coasting equipment, steel tube air forming, non-destructive inspections, clean room system, cast iron and steel rolls for hot rolling, and coolant systems. Its Logistics & Construction segment offers hydraulic excavators, crawler cranes, material handing systems, parking systems, transfer molding presses, cryopumps, proton therapy systems, forging presses, lifting magnets, spinning machines, dust collectors, surface grinding machines, extrusion coating line, road machinery, foundation machines, logistics systems, and forklifts. The company's Energy & Lifelines segment provides circulating fluidized bed (CFB) boilers, liquid air energy storage, electrostatic precipitators, evaporation and crystallization facilities, waste heat boilers, CFB scrubbers, flue gas denitrification systems, industrial wastewater treatment facilities, steam turbines, distillation technology and extractors, mixing vessels, and food and beverage manufacturing facilities. This segment also offers bubbling fluidized bed boilers, rotary kiln-type recycling facilities, ash handling systems, fluidized bed gasifiers, waste-to-energy plants baghouses, digital services, water and sewage treatment systems, process pumps, reactor vessels, coke oven machines, and oils tankers. The company provides IT solutions and security services. Sumitomo Heavy Industries, Ltd. was founded in 1888 and is headquartered in Tokyo, Japan.

About Kawasaki Heavy Industries

Kawasaki Heavy Industries, Ltd. engages in aerospace systems, energy solution and marine engineering, precision machinery and robot, rolling stock, and motorcycle and engine businesses in Japan and internationally. It manufactures aircraft for the Japan ministry of defense; helicopters; and helicopter and jet engines for commercial aircrafts. The company also manufactures railway cars; a range of rolling stocks, including Shinkansen, electric cars, passenger coaches, freight cars, locomotives, diesel locomotives, and transit systems. In addition, it engages in the production and sale of energy-related machinery and systems, marine machinery and systems, industrial equipment, and environmental equipment. Further, the company manufactures and supplies motorcycles, off-road four wheelers, watercrafts, general-purpose gasoline engines, etc. Additionally, it manufactures and sells pumps, motors, valves, and various hydraulic machinery, as well as assembles hydraulic systems; and industrial robots for use in welding, assembly, handling, painting, and palletization for various industries, including automotive and electronics industries. The company was founded in 1878 and is headquartered in Tokyo, Japan.