Analyzing Suzuki Motor (OTCMKTS:SZKMF) and Honda Motor (NYSE:HMC)

Honda Motor (NYSE:HMC) and Suzuki Motor (OTCMKTS:SZKMF) are both consumer cyclical companies, but which is the better business? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, profitability, valuation, analyst recommendations and dividends.

Institutional & Insider Ownership

5.3% of Honda Motor shares are held by institutional investors. Comparatively, 16.5% of Suzuki Motor shares are held by institutional investors. 0.0% of Honda Motor shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings for Honda Motor and Suzuki Motor, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Honda Motor	0	0	1	0	3.00
Suzuki Motor	0	0	0	0	N/A

Dividends

Honda Motor pays an annual dividend of $1.15 per share and has a dividend yield of 3.5%. Suzuki Motor pays an annual dividend of $19.11 per share and has a dividend yield of 169.1%. Honda Motor pays out 24.4% of its earnings in the form of a dividend. Suzuki Motor pays out 9.8% 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. Suzuki Motor is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Honda Motor and Suzuki Motor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Honda Motor	5.46%	8.79%	3.97%
Suzuki Motor	N/A	N/A	N/A

Valuation & Earnings

This table compares Honda Motor and Suzuki Motor’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Honda Motor	$21,208.66 billion	0.00	$7.64 billion	$4.72	6.98
Suzuki Motor	N/A	N/A	N/A	$195.69	0.06

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

Summary

Honda Motor beats Suzuki Motor on 7 of the 11 factors compared between the two stocks.

About Honda Motor

Honda Motor Co., Ltd. develops, manufactures, and distributes motorcycles, automobiles, power, and other products in Japan, North America, Europe, Asia, and internationally. It operates through four segments: Motorcycle Business, Automobile Business, Financial Services Business, and Power Product and Other Businesses. The Motorcycle Business segment produces motorcycles, including sports, business, and commuter models; and various off-road vehicles, such as all-terrain vehicles and side-by-sides. The Automobile Business segment offers passenger cars, light trucks, and mini vehicles. The Financial Services Business segment provides various financial services, including retail lending and leasing services to customers, as well as wholesale financing services to dealers. The Power Product and Other Businesses manufactures and sells power products, such as general purpose engines, lawn mowers, generators, water pumps, brush cutters, tillers, outboard marine engines, and snow throwers. This segment also offers HondaJet aircraft. The company also sells spare parts; and provides after-sale services through retail dealers directly, as well as through independent distributors and licensees. Honda Motor Co., Ltd. was founded in 1946 and is headquartered in Tokyo, Japan.

About Suzuki Motor

Suzuki Motor Corporation engages in the manufacturing and marketing of automobiles, motorcycles, and marine products in Japan, rest of Asia, Europe, North America, and internationally. It offers mini-vehicles, sub-compact vehicles, standard-sized vehicles, outboard motors, motorized wheelchairs, and electro senior vehicles. The company is also involved in solar power generation and logistics business, as well as provides other services. Suzuki Motor Corporation was founded in 1909 and is headquartered in Hamamatsu, Japan.