Gates Industrial (NYSE:GTES) versus Mueller Industries (MLI) Critical Contrast

Gates Industrial (NYSE: GTES) and Mueller Industries (NYSE:MLI) are both construction companies, but which is the better business? We will contrast the two companies based on the strength of their valuation, risk, dividends, analyst recommendations, profitability, institutional ownership and earnings.

Dividends

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Mueller Industries pays an annual dividend of $0.40 per share and has a dividend yield of 1.6%. Gates Industrial does not pay a dividend. Mueller Industries has increased its dividend for 6 consecutive years.

Valuation and Earnings

This table compares Gates Industrial and Mueller Industries’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Gates Industrial $3.04 billion 1.57 $151.30 million $0.82 20.54
Mueller Industries $2.27 billion 0.65 $85.59 million N/A N/A

Gates Industrial has higher revenue and earnings than Mueller Industries.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Gates Industrial and Mueller Industries, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Gates Industrial 0 2 5 0 2.71
Mueller Industries 0 0 0 0 N/A

Gates Industrial presently has a consensus price target of $22.14, suggesting a potential upside of 31.49%. Given Gates Industrial’s higher possible upside, research analysts clearly believe Gates Industrial is more favorable than Mueller Industries.

Institutional & Insider Ownership

93.4% of Mueller Industries shares are owned by institutional investors. 2.8% of Mueller Industries shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Gates Industrial and Mueller Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Gates Industrial N/A N/A N/A
Mueller Industries 3.78% 16.47% 6.62%

Summary

Mueller Industries beats Gates Industrial on 7 of the 13 factors compared between the two stocks.

Gates Industrial Company Profile

Gates Industrial Corporation PLC designs and manufactures power transmission equipment. Its products serves harsh and hazardous industries such as agriculture, construction, manufacturing and energy, to everyday consumer applications such as printers, power washers, automatic doors and vacuum cleaners and virtually every form of transportation.

Mueller Industries Company Profile

Mueller Industries, Inc. manufactures and sells copper, brass, aluminum, and plastic products in the United States, the United Kingdom, Canada, Asia, and Mexico. Its Piping Systems segment manufactures copper tubes and fittings, plastic fittings, line sets, and related components for water distribution system, heating system, air-conditioning, and refrigeration applications, as well as drainage, waste, and vent systems. It also manufactures steel pipe nipples; and resells imported brass and plastic plumbing valves, malleable iron fittings, faucets, and plumbing specialty products. This segment sells its products primarily to plumbing, refrigeration, and air-conditioning wholesalers; and hardware wholesalers and co-ops, building product retailers, and air-conditioning original equipment manufacturers (OEMs) through its sales offices and distribution centers, and agents. The company's Industrial Metals segment manufactures and sells brass, bronze, and copper alloy rods; cold-formed aluminum and copper products for automotive, military ordnance, aerospace, and general manufacturing industries; brass and aluminum forgings for automotive components, brass fittings, industrial machinery, valve bodies, gear blanks, and computer hardware; and brass, aluminum, and stainless steel valves, as well as fluid control systems and gas train assembles for compressed gas, pharmaceutical, construction, and gas appliance markets. Its Climate segment offers valves, protection devices, and brass fittings, as well as tubular assemblies and fabrications for various OEMs in the commercial heating, ventilation, and air-conditioning (HVAC) and refrigeration markets; components and accessories for the air-conditioning and refrigeration markets; and coaxial heat exchangers and twisted tubes for HVAC, geothermal, refrigeration, swimming pool heat pump, marine, ice machine, commercial boiler, and heat reclamation markets. The company was founded in 1900 and is headquartered in Memphis, Tennessee.

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