Critical Analysis: Fenix Parts (FENX) vs. Cooper-Standard (CPS)

Fenix Parts (OTCMKTS: FENX) and Cooper-Standard (NYSE:CPS) are both auto/tires/trucks companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, risk, profitability, institutional ownership, earnings, dividends and analyst recommendations.

Insider and Institutional Ownership

4.1% of Fenix Parts shares are held by institutional investors. Comparatively, 96.0% of Cooper-Standard shares are held by institutional investors. 16.6% of Fenix Parts shares are held by company insiders. Comparatively, 1.1% of Cooper-Standard shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Fenix Parts and Cooper-Standard, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Fenix Parts 0 0 0 0 N/A
Cooper-Standard 1 3 2 0 2.17

Cooper-Standard has a consensus target price of $114.80, indicating a potential downside of 13.60%. Given Cooper-Standard’s higher possible upside, analysts plainly believe Cooper-Standard is more favorable than Fenix Parts.

Profitability

This table compares Fenix Parts and Cooper-Standard’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Fenix Parts N/A N/A N/A
Cooper-Standard 3.88% 24.99% 7.71%

Volatility & Risk

Fenix Parts has a beta of 0.45, suggesting that its stock price is 55% less volatile than the S&P 500. Comparatively, Cooper-Standard has a beta of 0.8, suggesting that its stock price is 20% less volatile than the S&P 500.

Earnings & Valuation

This table compares Fenix Parts and Cooper-Standard’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Fenix Parts $132.10 million 0.04 -$42.86 million ($2.03) -0.11
Cooper-Standard $3.47 billion 0.67 $138.98 million $7.31 18.18

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

Summary

Cooper-Standard beats Fenix Parts on 11 of the 12 factors compared between the two stocks.

About Fenix Parts

Fenix Parts, Inc. is engaged in auto recycling business. The Company recovers and resells original equipment manufacturer (OEM) parts, components and systems, such as engines, transmissions, radiators, trunks, lamps and seats reclaimed from damaged, totaled or low value vehicles. The Company operates through Automobile Recycling segment. The Company purchases its vehicles primarily at auto salvage auctions. Upon receipt of vehicles, the Company inventories and then dismantles the vehicles and sells the recycled components. Its customers include collision repair shops (body shops), mechanical repair shops, auto dealerships and individual retail customers. The Company also generates a portion of its revenue from the sale as scrap of the unusable parts and materials, from the sale of used cars and motorcycles, the sale of aftermarket parts, and from the sale of extended warranty contracts.

About Cooper-Standard

Cooper-Standard Holdings Inc. is a holding company. The Company designs, manufactures and sells sealing, fuel and brake delivery, fluid transfer and anti-vibration systems for use in passenger vehicles and light trucks manufactured by global original equipment manufacturers (OEMs). The Company operates through four segments: North America, Europe, Asia Pacific and South America. The Company’s products are used in passenger vehicles and light trucks. As of December 31, 2016, the Company’s operations were conducted through 123 leased and joint venture facilities in 20 countries (North America: Canada, Mexico and the United States; Asia Pacific: China, India, Japan, South Korea and Thailand; Europe: Czech Republic, France, Germany, Italy, the Netherlands, Poland, Romania, Serbia, Spain, Sweden and the United Kingdom, and South America: Brazil), of which 90 are manufacturing facilities and 33 have design, engineering, administrative or logistics designations.

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