Head to Head Review: Garrett Motion (NYSE:GTX) and Atmus Filtration Technologies (NYSE:ATMU)

Atmus Filtration Technologies (NYSE:ATMU) and Garrett Motion (NYSE:GTX) are both mid-cap industrial products companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, dividends, analyst recommendations, earnings and profitability.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Atmus Filtration Technologies and Garrett Motion, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Atmus Filtration Technologies	0	1	4	0	2.80
Garrett Motion	0	0	1	0	3.00

Atmus Filtration Technologies currently has a consensus price target of $43.80, suggesting a potential upside of 4.85%. Garrett Motion has a consensus price target of $12.00, suggesting a potential upside of 25.26%. Given Garrett Motion’s stronger consensus rating and higher possible upside, analysts plainly believe Garrett Motion is more favorable than Atmus Filtration Technologies.

Dividends

Atmus Filtration Technologies pays an annual dividend of $0.20 per share and has a dividend yield of 0.5%. Garrett Motion pays an annual dividend of $0.24 per share and has a dividend yield of 2.5%. Atmus Filtration Technologies pays out 9.3% of its earnings in the form of a dividend. Garrett Motion pays out 23.5% 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.

Insider & Institutional Ownership

32.7% of Atmus Filtration Technologies shares are owned by institutional investors. Comparatively, 86.3% of Garrett Motion shares are owned by institutional investors. 0.4% of Atmus Filtration Technologies shares are owned by insiders. Comparatively, 0.6% of Garrett Motion shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Atmus Filtration Technologies and Garrett Motion’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Atmus Filtration Technologies	10.84%	134.28%	17.61%
Garrett Motion	6.54%	-31.48%	10.00%

Volatility and Risk

Atmus Filtration Technologies has a beta of 1.8, suggesting that its stock price is 80% more volatile than the S&P 500. Comparatively, Garrett Motion has a beta of 1.16, suggesting that its stock price is 16% more volatile than the S&P 500.

Earnings and Valuation

This table compares Atmus Filtration Technologies and Garrett Motion”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Atmus Filtration Technologies	$1.63 billion	2.13	$171.30 million	$2.15	19.43
Garrett Motion	$3.89 billion	0.53	$261.00 million	$1.02	9.39

Garrett Motion has higher revenue and earnings than Atmus Filtration Technologies. Garrett Motion is trading at a lower price-to-earnings ratio than Atmus Filtration Technologies, indicating that it is currently the more affordable of the two stocks.

Summary

Atmus Filtration Technologies beats Garrett Motion on 9 of the 16 factors compared between the two stocks.

About Atmus Filtration Technologies

Atmus Filtration Technologies Inc. designs, manufactures, and sells filtration products under the Fleetguard brand name in North America, Europe, South America, Asia, Australia, Africa, and internationally. The company offers fuel filters, lube filters, air filters, crankcase ventilation, hydraulic filters, coolants, and fuel additives, as well as other chemicals; and fuel water separators and other filtration systems to original equipment manufacturers, dealers/distributors, and end-users. Its products are used in on-highway commercial vehicles and off-highway agriculture, construction, mining, and power generation vehicles and equipment. The company was founded in 1958 and is headquartered in Nashville, Tennessee.

About Garrett Motion

Garrett Motion Inc., together with its subsidiaries, designs, manufactures, and sells turbocharging, air and fluid compression, and high-speed electric motor technologies for original equipment manufacturers and distributors worldwide. The company offers cutting-edge technology for the mobility and industrial space, including light vehicles, commercial vehicles, and industrial applications. In addition, it provides mechanical and electrical products for turbocharging and boosting internal combustion engines, as well as compressing air for fuel cell compressors, and compressing refrigerant for electric cooling compressors. The company offers its products in the aftermarket through distributors. Garrett Motion Inc. was incorporated in 2018 and is based in Rolle, Switzerland.