Critical Comparison: Sorl Auto Parts (SORL) & Continental (CTTAY)

Sorl Auto Parts (NASDAQ:SORL) and Continental (OTCMKTS:CTTAY) are both auto/tires/trucks companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, valuation, risk, institutional ownership, dividends, profitability and earnings.

Dividends

Continental pays an annual dividend of $0.39 per share and has a dividend yield of 2.3%. Sorl Auto Parts does not pay a dividend. Continental pays out 23.2% of its earnings in the form of a dividend.

Earnings & Valuation

This table compares Sorl Auto Parts and Continental’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sorl Auto Parts $468.05 million 0.13 $12.74 million $1.23 2.56
Continental $49.74 billion N/A $3.37 billion $1.68 10.26

Continental has higher revenue and earnings than Sorl Auto Parts. Sorl Auto Parts is trading at a lower price-to-earnings ratio than Continental, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Sorl Auto Parts has a beta of 2.47, indicating that its share price is 147% more volatile than the S&P 500. Comparatively, Continental has a beta of 1.12, indicating that its share price is 12% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and price targets for Sorl Auto Parts and Continental, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sorl Auto Parts 0 0 0 0 N/A
Continental 1 5 2 0 2.13

Profitability

This table compares Sorl Auto Parts and Continental’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sorl Auto Parts 2.72% 11.32% 3.10%
Continental 6.63% 17.51% 7.67%

Insider and Institutional Ownership

5.3% of Sorl Auto Parts shares are owned by institutional investors. 58.9% of Sorl Auto Parts shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Summary

Continental beats Sorl Auto Parts on 9 of the 13 factors compared between the two stocks.

About Sorl Auto Parts

SORL Auto Parts, Inc., together with its subsidiaries, develops, manufactures, and distributes automotive brake systems and other safety related auto parts to automotive original equipment manufacturers and the related aftermarket in the People's Republic of China. It operates through two segments, Commercial Vehicles Brake Systems and Passenger Vehicles Brake Systems. The company offers a range of products covering 65 categories and approximately 2000 specifications in automotive brake systems that are principally used in various types of commercial vehicles, such as trucks and buses. SORL Auto Parts, Inc. markets its products under the SORL brand through authorized distributors. The company exports its products to approximately 104 countries and regions. SORL Auto Parts, Inc. was founded in 2003 and is headquartered in Rui'an, the People's Republic of China.

About Continental

Continental Aktiengesellschaft provides products and services primarily for the automotive industry worldwide. It operates through Chassis&Safety, Powertrain, Interior, Tires, and ContiTech segments. The Chassis&Safety segment develops, produces, and markets intelligent systems to enhance driving safety and vehicle dynamics. This segment offers advanced driver assistance systems, hydraulic brake systems, passive safety and sensoric products, and vehicle dynamics products. The Powertrain segment provides engine systems, fuel and exhaust management systems, hybrid electric vehicles, sensors and actuators, and transmission products. The Interior segment develops and produces information, communication, and network solutions for cars and commercial vehicles, such as body and security, commercial vehicle and aftermarket, infotainment and connectivity, instrumentation and driver HMI, and intelligent transportation systems. The Tires segment provides passenger and light truck equipment, commercial vehicle, and two-wheel tires for use in vehicle manufacture and replacement businesses. The ContiTech segment develops, manufactures, and markets functional parts, and intelligent components and systems made of rubber, plastic, metal, and fabric for the machine and plant engineering, mining, agriculture, automotive, and other industries. This segment provides air spring systems, industrial fluid solutions, mobile fluid systems, and vibration control products, as well as conveyor belts and power transmission products. It also offers design, functional, foam, and compact foils, as well as artificial leather for the furniture and construction industries, as well as automotive sector. The company also provides engineering, business consulting, and fleet services. Continental Aktiengesellschaft was founded in 1871 and is headquartered in Hanover, Germany.

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