Critical Survey: Barnes Group (B) vs. American Outdoor Brands Corporation (AOBC)

Barnes Group (NYSE: B) and American Outdoor Brands Corporation (NASDAQ:AOBC) are both industrial products companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, valuation, risk, earnings, analyst recommendations, dividends and institutional ownership.

Earnings & Valuation

This table compares Barnes Group and American Outdoor Brands Corporation’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Barnes Group $1.34 billion 2.61 $305.46 million $2.86 22.76
American Outdoor Brands Corporation $903.19 million 0.84 $257.73 million $1.60 8.76

Barnes Group has higher revenue and earnings than American Outdoor Brands Corporation. American Outdoor Brands Corporation is trading at a lower price-to-earnings ratio than Barnes Group, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Barnes Group has a beta of 1.43, meaning that its share price is 43% more volatile than the S&P 500. Comparatively, American Outdoor Brands Corporation has a beta of 0.11, meaning that its share price is 89% less volatile than the S&P 500.

Dividends

Barnes Group pays an annual dividend of $0.56 per share and has a dividend yield of 0.9%. American Outdoor Brands Corporation does not pay a dividend. Barnes Group pays out 19.6% of its earnings in the form of a dividend. Barnes Group has raised its dividend for 4 consecutive years.

Profitability

This table compares Barnes Group and American Outdoor Brands Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Barnes Group 11.69% 13.02% 7.20%
American Outdoor Brands Corporation 10.96% 27.91% 14.47%

Insider & Institutional Ownership

85.3% of Barnes Group shares are held by institutional investors. Comparatively, 72.6% of American Outdoor Brands Corporation shares are held by institutional investors. 8.5% of Barnes Group shares are held by company insiders. Comparatively, 2.3% of American Outdoor Brands Corporation shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Barnes Group and American Outdoor Brands Corporation, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Barnes Group 0 2 3 0 2.60
American Outdoor Brands Corporation 0 6 4 0 2.40

Barnes Group currently has a consensus target price of $63.00, indicating a potential downside of 3.20%. American Outdoor Brands Corporation has a consensus target price of $19.00, indicating a potential upside of 35.62%. Given American Outdoor Brands Corporation’s higher possible upside, analysts clearly believe American Outdoor Brands Corporation is more favorable than Barnes Group.

Summary

Barnes Group beats American Outdoor Brands Corporation on 12 of the 17 factors compared between the two stocks.

About Barnes Group

Barnes Group Inc. is an industrial and aerospace manufacturer and service provider, serving a range of end markets and customers. The Company’s engineered products, industrial technologies, and solutions are used in applications that provide transportation, manufacturing, healthcare products and technology to the world. Its segments include Industrial and Aerospace. The Industrial segment is engaged in the manufacturing of precision parts, products and systems for applications serving a customer base in end-markets, such as transportation, industrial equipment, consumer products, packaging, electronics, medical devices and energy. The Industrial segment includes the Molding Solutions, Nitrogen Gas Products and Engineered Components business units. The Aerospace segment includes the original equipment manufacturer (OEM) business and the aftermarket business, which includes maintenance repair and overhaul services and the manufacture and delivery of aerospace aftermarket spare parts.

About American Outdoor Brands Corporation

American Outdoor Brands Corporation, formerly Smith & Wesson Holding Corporation, is a manufacturer of firearms and a provider of accessory products for the shooting, hunting and outdoor enthusiast. The Company operates through two segments. The Firearms segment manufactures handgun and long gun products sold under the Smith & Wesson, M&P and Thompson/Center Arms brands, as well as providing forging, machining and precision plastic injection molding services. The Outdoor Products & Accessories segment provides shooting, hunting and outdoor accessories, including reloading, gunsmithing, gun cleaning supplies, tree saws, vault accessories, knives, laser sighting systems and tactical lighting products. Brands in Outdoor Products & Accessories include Crimson Trace, Caldwell Shooting Supplies, Wheeler Engineering, Lockdown Vault Accessories, BOG POD and Golden Rod Moisture Control, as well as knives and specialty tools under Schrade, Old Timer, Uncle Henry and Imperial.

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