Wolverine World Wide (NYSE:WWW) and The Toro (NYSE:TTC) are both consumer discretionary companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, risk, analyst recommendations, dividends, earnings, institutional ownership and valuation.
Dividends
Wolverine World Wide pays an annual dividend of $0.40 per share and has a dividend yield of 1.0%. The Toro pays an annual dividend of $1.05 per share and has a dividend yield of 0.9%. Wolverine World Wide pays out 17.8% of its earnings in the form of a dividend. The Toro pays out 34.8% 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. Wolverine World Wide has raised its dividend for 1 consecutive years and The Toro has raised its dividend for 1 consecutive years. Wolverine World Wide is clearly the better dividend stock, given its higher yield and lower payout ratio.
Profitability
This table compares Wolverine World Wide and The Toro's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Wolverine World Wide | 3.00% | 17.74% | 5.25% |
| The Toro | 9.76% | 32.24% | 11.95% |
Institutional & Insider Ownership
91.5% of Wolverine World Wide shares are owned by institutional investors. Comparatively, 80.5% of The Toro shares are owned by institutional investors. 4.9% of Wolverine World Wide shares are owned by insiders. Comparatively, 1.8% of The Toro shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Risk & Volatility
Wolverine World Wide has a beta of 1.59, suggesting that its stock price is 59% more volatile than the S&P 500. Comparatively, The Toro has a beta of 0.73, suggesting that its stock price is 27% less volatile than the S&P 500.
Valuation & Earnings
This table compares Wolverine World Wide and The Toro's top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Wolverine World Wide | $2.27 billion | 1.41 | $128.50 million | $2.25 | 17.26 |
| The Toro | $3.38 billion | 3.61 | $329.70 million | $3.02 | 37.54 |
The Toro has higher revenue and earnings than Wolverine World Wide. Wolverine World Wide is trading at a lower price-to-earnings ratio than The Toro, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a breakdown of recent ratings for Wolverine World Wide and The Toro, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Wolverine World Wide | 0 | 4 | 6 | 0 | 2.60 |
| The Toro | 0 | 4 | 1 | 0 | 2.20 |
Wolverine World Wide currently has a consensus target price of $33.30, indicating a potential downside of 14.26%. The Toro has a consensus target price of $95.00, indicating a potential downside of 16.21%. Given Wolverine World Wide's stronger consensus rating and higher possible upside, research analysts clearly believe Wolverine World Wide is more favorable than The Toro.
Summary
Wolverine World Wide beats The Toro on 9 of the 16 factors compared between the two stocks.
