Snap-On (NYSE:SNA) & ESAB (NYSE:ESAB) Head-To-Head Survey

Snap-On (NYSE:SNA) and ESAB (NYSE:ESAB) are both industrials companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, risk, profitability, institutional ownership, earnings, analyst recommendations and valuation.

Institutional & Insider Ownership

84.9% of Snap-On shares are owned by institutional investors. Comparatively, 91.1% of ESAB shares are owned by institutional investors. 3.8% of Snap-On shares are owned by insiders. Comparatively, 7.2% of ESAB shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Snap-On pays an annual dividend of $9.76 per share and has a dividend yield of 2.7%. ESAB pays an annual dividend of $0.48 per share and has a dividend yield of 0.7%. Snap-On pays out 49.8% of its earnings in the form of a dividend. ESAB pays out 17.2% 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. Snap-On has increased its dividend for 15 consecutive years and ESAB has increased its dividend for 3 consecutive years. Snap-On is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Snap-On and ESAB”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Snap-On	$4.74 billion	4.00	$1.02 billion	$19.61	18.72
ESAB	$2.84 billion	1.49	$226.77 million	$2.79	24.35

Snap-On has higher revenue and earnings than ESAB. Snap-On is trading at a lower price-to-earnings ratio than ESAB, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Snap-On has a beta of 0.72, suggesting that its stock price is 28% less volatile than the S&P 500. Comparatively, ESAB has a beta of 1.17, suggesting that its stock price is 17% more volatile than the S&P 500.

Profitability

This table compares Snap-On and ESAB’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Snap-On	21.25%	17.07%	12.00%
ESAB	5.75%	14.48%	5.99%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Snap-On and ESAB, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Snap-On	0	1	5	0	2.83
ESAB	0	1	7	0	2.88

Snap-On presently has a consensus price target of $426.20, suggesting a potential upside of 16.07%. ESAB has a consensus price target of $135.57, suggesting a potential upside of 99.58%. Given ESAB’s stronger consensus rating and higher possible upside, analysts clearly believe ESAB is more favorable than Snap-On.

Summary

Snap-On beats ESAB on 9 of the 17 factors compared between the two stocks.

About Snap-On

Snap-on Incorporated manufactures and markets tools, equipment, diagnostics, and repair information and systems solutions for professional users worldwide. It operates through Commercial & Industrial Group, Snap-on Tools Group, Repair Systems & Information Group, and Financial Services segments. The company provides hand tools, including wrenches, sockets, ratchet wrenches, pliers, screwdrivers, punches and chisels, saws and cutting tools, pruning tools, torque measuring instruments, and other related products; power tools, such as cordless, pneumatic, and hydraulic and corded tools; and tool storage products comprising tool chests, roll cabinets, and other products. It provides handheld and computer-based diagnostic products, service and repair information products, diagnostic software solutions, electronic parts catalogs, business management systems and services, point-of-sale systems, integrated systems for vehicle service shops, original equipment manufacturer purchasing facilitation services, and warranty management systems and analytics; and engineered solutions. In addition, the company offers solutions for the service of vehicles and industrial equipment that include wheel alignment equipment, wheel balancers, tire changers, vehicle lifts, test lane equipment, collision repair equipment, vehicle air conditioning service equipment, brake service equipment, fluid exchange equipment, transmission troubleshooting equipment, safety testing equipment, battery chargers, and hoists, as well as after-sales support services and training programs. Further, it provides financing programs to facilitate the sales of its products and support its franchise business. It serves the aviation and aerospace, agriculture, infrastructure construction, government and military, mining, natural resources, power generation, and technical education industries. Snap-on Incorporated was incorporated in 1920 and is headquartered in Kenosha, Wisconsin.

About ESAB

ESAB Corporation engages in the formulation, development, manufacture, and supply of consumable products and equipment for use in cutting, joining, automated welding, and gas control equipment. Its comprehensive range of welding consumables includes electrodes, cored and solid wires, and fluxes using a range of specialty and other materials; and cutting consumables comprising electrodes, nozzles, shields, and tips. The company's equipment ranges from portable welding machines to large customized automated cutting and welding systems. It also offers a range of software and digital solutions to help its customers increase their productivity, remotely monitor their welding operations, and digitize their documentation. The company sells its products under the ESAB brand to various end markets, such as general industry, infrastructure, renewable energy, medical and life sciences, transportation, construction, and energy. It offers its products through independent distributors and direct salespeople. The company operates in North America, South America, Europe, the Middle East, India, Africa, and the Asia Pacific. ESAB Corporation was founded in 1904 and is headquartered in North Bethesda, Maryland.