Critical Analysis: Manitowoc (NYSE:MTW) vs. Wabash National (NYSE:WNC)

Wabash National (NYSE:WNC) and Manitowoc (NYSE:MTW) are both small-cap auto/tires/trucks companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, institutional ownership, profitability, valuation, analyst recommendations, risk and dividends.

Profitability

This table compares Wabash National and Manitowoc’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Wabash National	6.66%	28.24%	11.18%
Manitowoc	0.40%	4.28%	1.46%

Insider & Institutional Ownership

97.1% of Wabash National shares are held by institutional investors. Comparatively, 78.7% of Manitowoc shares are held by institutional investors. 1.8% of Wabash National shares are held by insiders. Comparatively, 2.5% of Manitowoc shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Dividends

Wabash National pays an annual dividend of $0.32 per share and has a dividend yield of 1.7%. Manitowoc pays an annual dividend of $0.08 per share and has a dividend yield of 0.8%. Wabash National pays out 7.7% of its earnings in the form of a dividend. Manitowoc pays out 10.7% 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. Wabash National is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility and Risk

Wabash National has a beta of 1.53, indicating that its share price is 53% more volatile than the S&P 500. Comparatively, Manitowoc has a beta of 1.85, indicating that its share price is 85% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings for Wabash National and Manitowoc, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Wabash National	0	2	0	0	2.00
Manitowoc	2	4	0	0	1.67

Wabash National currently has a consensus target price of $20.50, suggesting a potential upside of 8.47%. Manitowoc has a consensus target price of $13.22, suggesting a potential upside of 35.97%. Given Manitowoc’s higher probable upside, analysts clearly believe Manitowoc is more favorable than Wabash National.

Earnings and Valuation

This table compares Wabash National and Manitowoc”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Wabash National	$2.54 billion	0.33	$231.25 million	$4.16	4.54
Manitowoc	$2.17 billion	0.16	$39.20 million	$0.75	12.96

Wabash National has higher revenue and earnings than Manitowoc. Wabash National is trading at a lower price-to-earnings ratio than Manitowoc, indicating that it is currently the more affordable of the two stocks.

Summary

Wabash National beats Manitowoc on 11 of the 15 factors compared between the two stocks.

About Wabash National

Wabash National Corporation provides connected solutions for the transportation, logistics, and distribution industries primarily in the United States. The company operates through two segments, Transportation Solutions and Parts & Services. The Transportation Solutions segment designs and manufactures transportation-related equipment and products dry and refrigerated van trailers, platform trailers, tank trailers, and truck-mounted tanks; truck bodies for dry-freight transportation; cargo and cargo XL bodies for commercial applications; refrigerated truck bodies; platform truck bodies; and used trailers, as well as laminated hardwood oak flooring products. The Parts & Services segment provides aftermarket parts and services; steel flatbed bodies, truck body mounting, shelving for package delivery, partitions, roof racks, hitches, liftgates, thermal solutions, and others; truck body repair parts; and door repair and replacement, collision repair, and basic maintenance services. It also develops and scales a digital marketplace for the transportation and logistics distribution industry; operates a parts and services distribution platform; and stainless steel storage tanks and silos, mixers, and processors for the dairy, food and beverage, pharmaceutical, chemical, craft brewing, and biotech markets; trailers as a service; and composite products, including truck bodies, overhead doors, and other industrial application products, as well as used trailers. The company offers its products under the Wabash, DuraPlate, DuraPlateHD, DuraPlate AeroSkirt, and AeroSkirt CX brands, as well as EcoNex brand. It serves its products to truckload common carriers, leasing companies, private fleet carriers, less-than-truckload common carriers, and package carriers. Wabash National Corporation was founded in 1985 and is headquartered in Lafayette, Indiana.

About Manitowoc

The Manitowoc Company, Inc. provides engineered lifting solutions in the Americas, Europe, Africa, the Middle East, the Asia Pacific, and internationally. It designs, manufactures, and distributes crawler-mounted lattice-boom cranes under the Manitowoc brand; a line of top-slewing and self-erecting tower cranes under the Potain brand; mobile hydraulic cranes under the Grove, Shuttlelift, and National Crane brands; and hydraulic boom trucks under the National Crane brand. The company also provides aftermarket services, such as sale of parts and accessories, field service work, routine maintenance services, technical support, erection and decommissioning services, crane and component remanufacturing, training, and telematics services. Its crane products are used in various applications, including energy production/distribution and utilities; petrochemical and industrial; infrastructure, such as road, bridge, and airport construction; and commercial and residential construction. The company serves a range of customers, including dealers, rental companies, contractors, and government entities in the petrochemical, industrial, commercial construction, power and utilities, infrastructure, and residential construction end markets. The Manitowoc Company, Inc. was founded in 1902 and is headquartered in Milwaukee, Wisconsin.