Clean Diesel Technologies (NASDAQ: CDTI) and Dorman Products (NASDAQ:DORM) are both basic materials companies, but which is the superior investment? We will compare the two companies based on the strength of their analyst recommendations, dividends, valuation, earnings, profitabiliy, risk and institutional ownership.
Risk and Volatility
Clean Diesel Technologies has a beta of 2.87, indicating that its share price is 187% more volatile than the S&P 500. Comparatively, Dorman Products has a beta of 0.63, indicating that its share price is 37% less volatile than the S&P 500.
Analyst Ratings
This is a summary of recent recommendations for Clean Diesel Technologies and Dorman Products, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Clean Diesel Technologies | 0 | 1 | 2 | 0 | 2.67 |
| Dorman Products | 0 | 3 | 0 | 0 | 2.00 |
Clean Diesel Technologies presently has a consensus target price of $4.17, suggesting a potential upside of 80.99%. Dorman Products has a consensus target price of $78.00, suggesting a potential downside of 0.27%. Given Clean Diesel Technologies’ stronger consensus rating and higher probable upside, equities research analysts plainly believe Clean Diesel Technologies is more favorable than Dorman Products.
Valuation and Earnings
This table compares Clean Diesel Technologies and Dorman Products’ top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| Clean Diesel Technologies | $35.31 million | 1.02 | -$7.52 million | ($3.21) | -0.72 |
| Dorman Products | $873.08 million | 3.07 | $194.12 million | $3.20 | 24.44 |
Dorman Products has higher revenue and earnings than Clean Diesel Technologies. Clean Diesel Technologies is trading at a lower price-to-earnings ratio than Dorman Products, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Clean Diesel Technologies and Dorman Products’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Clean Diesel Technologies | -67.54% | -167.10% | -35.01% |
| Dorman Products | 12.66% | 18.79% | 16.05% |
Institutional & Insider Ownership
1.0% of Clean Diesel Technologies shares are owned by institutional investors. Comparatively, 77.1% of Dorman Products shares are owned by institutional investors. 5.3% of Clean Diesel Technologies shares are owned by insiders. Comparatively, 11.7% of Dorman Products shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Summary
Dorman Products beats Clean Diesel Technologies on 9 of the 13 factors compared between the two stocks.
Clean Diesel Technologies Company Profile
Clean Diesel Technologies, Inc. commercializes its material technology by manufacturing and distributing light duty vehicle catalysts, and heavy duty diesel emissions control systems and products to automakers, distributors, integrators and retrofitters. The Company operates through two business division segments: Catalyst, which develops and produces catalysts to reduce emissions from gasoline, diesel and natural gas combustion engines, and Heavy Duty Diesel Systems, which designs and manufactures verified exhaust emissions control solutions for a range of heavy duty diesel applications. It develops materials incorporating various base metals that replace platinum group metals (PGM) and rare earth metals in coatings on vehicle catalytic converters. Its technologies include Spinel, base-metal activated rhodium on Support, mixed phase catalyst, synergized PGM diesel oxidation catalyst (SPGM DOC), Platinum Plus, ARIS, and Exhaust Gas Recirculation and Selective Catalytic Reduction.
Dorman Products Company Profile
Dorman Products, Inc. is a supplier of replacement parts and fasteners for passenger cars, light trucks and heavy duty trucks in the automotive aftermarket. As of December 31, 2016, the Company distributed and marketed approximately 155,000 different stock keeping units (SKU’s) of automotive replacement parts and fasteners. As of December 31, 2016, approximately 83% of its products were sold under brands that it owned and the remainder of its products were sold for resale under customers’ private labels, other brands or in bulk. Its products are sold in the United States through automotive aftermarket retailers, national, regional and local warehouse distributors, and specialty markets, and salvage yards. It also distributes automotive replacement parts outside the United States, with sales primarily into Canada, Mexico, Europe, the Middle East, and Australia. Its parts are marketed under the OE Solutions, TECHoice, AutoGrade, Conduct-Tite, FirstStop and HD Solutions brand names.
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