Lear (NYSE:LEA) and Adomani (NASDAQ:ADOM) are both auto/tires/trucks 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

Lear pays an annual dividend of $3.00 per share and has a dividend yield of 1.9%. Adomani does not pay a dividend. Lear pays out 16.5% of its earnings in the form of a dividend. Lear has raised its dividend for 8 consecutive years.

Profitability

This table compares Lear and Adomani’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Lear 5.37% 27.12% 9.93%
Adomani -220.48% -119.79% -91.55%

Institutional & Insider Ownership

98.1% of Lear shares are held by institutional investors. Comparatively, 2.2% of Adomani shares are held by institutional investors. 0.4% of Lear shares are held by company insiders. Comparatively, 30.1% of Adomani shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk and Volatility

Lear has a beta of 1.32, meaning that its share price is 32% more volatile than the S&P 500. Comparatively, Adomani has a beta of 1.78, meaning that its share price is 78% more volatile than the S&P 500.

Valuation & Earnings

This table compares Lear and Adomani’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Lear $21.15 billion 0.46 $1.15 billion $18.22 8.47
Adomani $5.01 million 5.52 -$11.04 million ($0.15) -2.53

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

Analyst Ratings

This is a breakdown of recent ratings for Lear and Adomani, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Lear 0 4 12 0 2.75
Adomani 0 0 3 0 3.00

Lear currently has a consensus target price of $179.14, indicating a potential upside of 15.71%. Adomani has a consensus target price of $2.50, indicating a potential upside of 557.89%. Given Adomani’s stronger consensus rating and higher possible upside, analysts clearly believe Adomani is more favorable than Lear.

Summary

Lear beats Adomani on 11 of the 17 factors compared between the two stocks.

Lear Company Profile

Lear Corporation designs, develops, engineers, manufactures, assembles, and supplies automotive seating, and electrical distribution systems and related components for automotive original equipment manufacturers worldwide. It operates in two segments, Seating and E-Systems. The Seating segment offers leather and fabric products, seat trim covers, recliner mechanisms, seat tracks and foams, seat structures and mechanisms, and headrests for automobiles and light trucks, compact cars, and sport utility vehicles; and heating and cooling systems. The E-Systems segment offers electrical distribution systems that route electrical signals and manage electrical power within the vehicle for traditional vehicle architectures, as well as high power and hybrid electric systems. This segment's products comprise wire harnesses, terminals and connectors, and junction boxes; and electronic control modules, such as body control modules, smart junction boxes, gateway and wireless control modules, lighting control modules, and audio domain controllers and amplifiers. It also provides electrification products comprising charging systems that include onboard charging modules, cord set charging equipment, and wireless charging systems; battery electronics, which comprise battery disconnect units, cell monitoring supervisory systems, and integrated total battery control modules; and other power management modules, including converter and inverter systems. In addition, this segment offers cybersecurity software; EXO advanced vehicle positioning for automated and autonomous driving applications; roadside modules that communicate real-time traffic information; and cellular protocols for vehicle connectivity, as well as Connexus connectivity products. Further, it provides wireless systems, such as passive entry, remote keyless entry, and dual range/function remote keyless entry systems. The company was founded in 1917 and is headquartered in Southfield, Michigan.

Adomani Company Profile

ADOMANI, Inc. provides zero-emission electric and hybrid drivetrain systems for integration in new and existing school buses and medium to heavy-duty commercial fleet vehicles. Its products include traction motor/generator and motor controller, as well as power-flow set up for direct-drive configuration, which is a single speed gearbox, or a multi-gear ration transmission system. The company also offers lithium-ion battery packs, inverters, chargers, electrically driven systems for power steering and brakes, wiring harnesses, flat screen user-interface, and fleet technician diagnostic tools. ADOMANI, Inc. was founded in 2012 and is headquartered in Corona, California.

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