Head-To-Head Review: Peloton (NASDAQ:PTON) versus Emerson Electric (NASDAQ:EMR)

Emerson Electric (NYSE:EMR) and Peloton (NASDAQ:PTON) are both industrial products companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, profitability, valuation, institutional ownership and risk.

Insider & Institutional Ownership

70.6% of Emerson Electric shares are owned by institutional investors. Comparatively, 21.5% of Peloton shares are owned by institutional investors. 0.1% of Emerson Electric shares are owned 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 Recommendations

This is a breakdown of current ratings and target prices for Emerson Electric and Peloton, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Emerson Electric 1 7 7 0 2.40
Peloton 0 3 19 0 2.86

Emerson Electric presently has a consensus target price of $71.67, indicating a potential downside of 2.97%. Peloton has a consensus target price of $31.56, indicating a potential downside of 10.43%. Given Emerson Electric’s higher possible upside, analysts plainly believe Emerson Electric is more favorable than Peloton.

Valuation and Earnings

This table compares Emerson Electric and Peloton’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Emerson Electric $18.37 billion 2.45 $2.31 billion $3.69 20.02
Peloton $915.00 million 10.80 -$195.60 million N/A N/A

Emerson Electric has higher revenue and earnings than Peloton.

Dividends

Emerson Electric pays an annual dividend of $2.00 per share and has a dividend yield of 2.7%. Peloton does not pay a dividend. Emerson Electric pays out 54.2% of its earnings in the form of a dividend.

Profitability

This table compares Emerson Electric and Peloton’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Emerson Electric 12.55% 26.32% 10.72%
Peloton N/A N/A N/A

Summary

Emerson Electric beats Peloton on 9 of the 13 factors compared between the two stocks.

Emerson Electric Company Profile

Emerson Electric Co., a technology and engineering company, provides various solutions to industrial, commercial, and consumer markets worldwide. The company's Automation Solutions segment offers products and integrated solutions, including measurement and analytical instrumentation; valves, actuators, and regulators; industrial solutions; and process control systems and solutions. It serves the oil and gas, refining, chemicals and power generation, pharmaceuticals, food and beverage, automotive, pulp and paper, metals and mining, and municipal water supplies markets. The company's Climate Technologies segment offers residential and commercial heating and air conditioning products, such as residential and variable speed scroll compressors; system protector and flow control devices; standard, programmable, and Wi-Fi thermostats; monitoring equipment and electronic controls for gas and electric heating systems; gas valves for furnaces and water heaters; ignition systems for furnaces; sensors and thermistors for home appliances; and temperature sensors and controls. It also provides commercial and industrial refrigeration products that include reciprocating, scroll, and screw compressors; precision flow controls; system diagnostics and controls; and environmental control systems for use in medical, food processing, and cold storage applications. In addition, this segment offers air conditioning, refrigeration, and lighting control technologies, as well as facility design and product management, site commissioning, facility monitoring, and energy modeling services; and temperature management and monitoring products for the foodservice markets. Its Tools & Home Products segment offers professional and homeowner tools, and appliance solutions. The company was formerly known as The Emerson Electric Manufacturing Company and changed its name to Emerson Electric Co. in 2000. Emerson Electric Co. was founded in 1890 and is headquartered in St. Louis, Missouri.

Peloton Company Profile

Peloton Interactive, Inc. provides interactive fitness products in North America. It offers connected fitness products, such as the Peloton Bike and the Peloton Tread, which include touchscreen that streams live and on-demand classes. The company also provides connected fitness subscriptions for multiple household users, and access to all live and on-demand classes, as well as Peloton Digital app for connected fitness subscribers to provide access to its classes. It has approximately 1.4 million members. The company markets and sells its interactive fitness products directly through its retail showrooms and at onepeloton.com Peloton Interactive, Inc. was founded in 2012 and is headquartered in New York, New York.

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