LCI Industries (NYSE:LCII) versus Visteon (NASDAQ:VC) Critical Contrast

LCI Industries (NYSE:LCII) and Visteon (NASDAQ:VC) are both consumer discretionary companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, valuation, profitability, institutional ownership, risk, dividends and earnings.

Insider and Institutional Ownership

99.7% of LCI Industries shares are owned by institutional investors. Comparatively, 99.7% of Visteon shares are owned by institutional investors. 3.3% of LCI Industries shares are owned by insiders. Comparatively, 2.0% of Visteon shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
LCI Industries	5.24%	14.33%	6.19%
Visteon	4.15%	11.36%	5.39%

Risk & Volatility

LCI Industries has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500. Comparatively, Visteon has a beta of 1.26, suggesting that its stock price is 26% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations for LCI Industries and Visteon, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
LCI Industries	0	7	2	0	2.22
Visteon	1	4	8	0	2.54

LCI Industries currently has a consensus target price of $113.50, suggesting a potential upside of 16.07%. Visteon has a consensus target price of $117.82, suggesting a potential upside of 55.68%. Given Visteon’s stronger consensus rating and higher probable upside, analysts clearly believe Visteon is more favorable than LCI Industries.

Dividends

LCI Industries pays an annual dividend of $4.60 per share and has a dividend yield of 4.7%. Visteon pays an annual dividend of $1.50 per share and has a dividend yield of 2.0%. LCI Industries pays out 53.5% of its earnings in the form of a dividend. Visteon pays out 25.9% 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. LCI Industries has increased its dividend for 8 consecutive years. LCI Industries is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares LCI Industries and Visteon”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
LCI Industries	$4.12 billion	0.58	$188.25 million	$8.60	11.37
Visteon	$3.77 billion	0.50	$201.00 million	$5.80	13.05

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

Summary

LCI Industries beats Visteon on 9 of the 16 factors compared between the two stocks.

About LCI Industries

LCI Industries, together with its subsidiaries, manufactures and supplies engineered components for the manufacturers of recreational vehicles (RVs) and adjacent industries in the United States and internationally. It operates through two segments: Original Equipment Manufacturers (OEM) and Aftermarket. The OEM segment manufactures and distributes a range of engineered components, such as steel chassis and related components; axles, ABS, and suspension solutions; slide-out mechanisms and solutions; thermoformed bath, kitchen, and other products; vinyl, aluminum, and frameless windows; manual, electric, and hydraulic stabilizer and leveling systems; entry, luggage, patio, and ramp doors; furniture and mattresses; electric and manual entry steps; awnings and awning accessories; electronic components; appliances; air conditioners; televisions and sound systems; tankless water heaters; towing products; truck accessories; and other accessories. This segment serves OEMs of RVs and adjacent industries, including buses; trailers used to haul boats, livestock, equipment, and other cargo; trucks; boats; trains; manufactured homes; and modular housing. The Aftermarket segment supplies engineered components to aftermarket channels of the recreation and transportation markets for retail dealers, wholesale distributors, and service centers, as well as direct to retail customers through the Internet. This segment also sells replacement glass and awnings to fulfill insurance claims; and biminis, covers, buoys, fenders to the marine industry, towing products, truck accessories, appliances, air conditioners, televisions, sound systems, and tankless water heaters. The company was formerly known as Drew Industries Incorporated and changed its name to LCI Industries in December 2016. LCI Industries was founded in 1956 and is based in Elkhart, Indiana.

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.