Titan Machinery (NASDAQ: TITN) and Toro Company (The) (NYSE:TTC) are both retail/wholesale companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, institutional ownership, dividends, earnings, analyst recommendations and profitabiliy.
Insider & Institutional Ownership
81.2% of Titan Machinery shares are held by institutional investors. Comparatively, 76.0% of Toro Company (The) shares are held by institutional investors. 16.1% of Titan Machinery shares are held by company insiders. Comparatively, 5.7% of Toro Company (The) shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Profitability
This table compares Titan Machinery and Toro Company (The)’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Titan Machinery | -1.37% | -4.11% | -1.54% |
| Toro Company (The) | 10.23% | 44.74% | 17.18% |
Dividends
Toro Company (The) pays an annual dividend of $0.70 per share and has a dividend yield of 1.0%. Titan Machinery does not pay a dividend. Toro Company (The) pays out 31.0% of its earnings in the form of a dividend. Titan Machinery has raised its dividend for 7 consecutive years.
Analyst Recommendations
This is a breakdown of recent recommendations and price targets for Titan Machinery and Toro Company (The), as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Titan Machinery | 0 | 2 | 1 | 0 | 2.33 |
| Toro Company (The) | 0 | 1 | 3 | 0 | 2.75 |
Titan Machinery presently has a consensus price target of $18.00, suggesting a potential upside of 2.62%. Toro Company (The) has a consensus price target of $57.33, suggesting a potential downside of 20.78%. Given Titan Machinery’s higher probable upside, equities research analysts plainly believe Titan Machinery is more favorable than Toro Company (The).
Volatility & Risk
Titan Machinery has a beta of 1.35, indicating that its share price is 35% more volatile than the S&P 500. Comparatively, Toro Company (The) has a beta of 0.56, indicating that its share price is 44% less volatile than the S&P 500.
Earnings & Valuation
This table compares Titan Machinery and Toro Company (The)’s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| Titan Machinery | $1.19 billion | 0.32 | $25.00 million | ($0.76) | -23.08 |
| Toro Company (The) | $2.46 billion | 3.17 | $412.45 million | $2.26 | 32.02 |
Toro Company (The) has higher revenue and earnings than Titan Machinery. Titan Machinery is trading at a lower price-to-earnings ratio than Toro Company (The), indicating that it is currently the more affordable of the two stocks.
Summary
Toro Company (The) beats Titan Machinery on 10 of the 16 factors compared between the two stocks.
About Titan Machinery
Titan Machinery Inc. owns and operates a network of service agricultural and construction equipment stores in the United States and Europe. The Company engages in four principal business activities: new and used equipment sales; parts sales; repair and maintenance services, and equipment rental and other activities. It has three business segments: Agriculture, Construction and International. Its agricultural equipment includes machinery and attachments for large-scale farming, and home and garden purposes. Its construction equipment includes heavy construction and light industrial machinery for commercial and residential construction, road and highway construction, and mining operations. It sells new agricultural and construction equipment. It provides in-store and on-site repair and maintenance services. It also rents equipment and provides ancillary services, such as equipment transportation, global positioning system signal subscriptions, and finance and insurance products.
About Toro Company (The)
The Toro Company (Toro) is engaged in the designing, manufacturing, and marketing of professional turf maintenance equipment and services, turf irrigation systems, landscaping equipment and lighting products, snow and ice management products, agricultural micro-irrigation systems, rental and specialty construction equipment, and residential yard and snow thrower products. The Company operates through three segments: Professional, Residential and Distribution. Under the Professional segment, Toro designs professional turf, landscape and lighting, rental and specialty construction, snow and ice management, and agricultural products. The Residential segment provides products, such as riding products, home solutions products and snow thrower products. It manufactures and markets various walk power mower models. The Distribution segment consists of Company-owned domestic distributorship. Its brands include Toro, Exmark, BOSS, Irritrol, Hayter, Pope, Unique Lighting Systems and Lawn-Boy.
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