Toro (NYSE:TTC) versus RBC Bearings (NASDAQ:ROLL) Financial Review

Toro (NYSE:TTC) and RBC Bearings (NASDAQ:ROLL) are both mid-cap industrials companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, earnings, analyst recommendations, valuation, institutional ownership, dividends and risk.

Insider & Institutional Ownership

88.0% of Toro shares are owned by institutional investors. 1.6% of Toro shares are owned by insiders. Comparatively, 2.8% of RBC Bearings shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Volatility & Risk

Toro has a beta of 0.68, indicating that its stock price is 32% less volatile than the S&P 500. Comparatively, RBC Bearings has a beta of 1.34, indicating that its stock price is 34% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations for Toro and RBC Bearings, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Toro	0	3	0	0	2.00
RBC Bearings	0	0	0	0	N/A

Toro currently has a consensus target price of $93.33, indicating a potential upside of 11.26%. Given Toro’s higher possible upside, equities research analysts plainly believe Toro is more favorable than RBC Bearings.

Earnings & Valuation

This table compares Toro and RBC Bearings”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Toro	$4.55 billion	1.89	$329.70 million	$3.81	22.02
RBC Bearings	$1.14 billion	7.31	$59.60 million	$2.06	139.85

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

Profitability

This table compares Toro and RBC Bearings’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Toro	8.89%	25.94%	10.95%
RBC Bearings	N/A	N/A	N/A

Summary

Toro beats RBC Bearings on 8 of the 12 factors compared between the two stocks.

About Toro

The Toro Company designs, manufactures, markets, and sells professional turf maintenance equipment and services. It operates through two segments: Professional and Residential. The Professional segment offers turf and landscape equipment products, including sports fields and grounds mowing and maintenance equipment, golf course mowing and maintenance equipment, landscape contractor mowing equipment, landscape creation and renovation equipment, and other maintenance equipment; rental, specialty, and underground construction equipment, such as horizontal directional drills, walk and ride trenchers, stand-on skid steers, vacuum excavators, stump grinders, turf renovation products, asset locators, pipe rehabilitation solutions, materials handling equipment, and other after-market tools; and snow and ice management equipment, such as snowplows, as well as stand-on snow and ice removal equipment, such as snowplow, snow brush, and snow thrower attachments, salt and sand spreaders, and related parts and accessories for light and medium duty trucks, utility task vehicles, skid steers, and front-end loaders. This segment also provides irrigation and lighting products that consist of sprinkler heads, electric and hydraulic valves, controllers, computer irrigation central control systems, coupling systems, and ag-irrigation drip tape and hose products, as well as professionally installed landscape lighting products offered through distributors and landscape contractors. The Residential segment provides walk power mowers, zero-turn riding mowers, snow throwers, replacement parts, and home solution products that include grass and hedge trimmers, leaf blowers, blower-vacuums, chainsaws, string trimmers, hoses, and hose-end retail irrigation products. It sells its products through a network of distributors, dealers, mass retailers, hardware retailers, equipment rental centers, home centers, and online. The company was founded in 1914 and is headquartered in Bloomington, Minnesota.

About RBC Bearings

RBC Bearings Incorporated manufactures and markets engineered precision bearings and components in the United States and internationally. It operates through two segments, Aerospace/Defense and Industrial. The company produces plain bearings with self-lubricating or metal-to-metal designs, including rod end bearings, spherical plain bearings, and journal bearings; roller bearings, such as tapered roller bearings, needle roller bearings, and needle bearing track rollers and cam followers, which are anti-friction products that are used in industrial applications and military aircraft platforms; and ball bearings include high precision aerospace, airframe control, thin section, and industrial ball bearings that utilize high precision ball elements to reduce friction in high-speed applications. It also offers mounted bearing products include mounted ball bearings, mounted roller bearings, and mounted plain bearings; and enclosed gearing product lines, including quantis gearmotor, torque arm, tigear, magnagear & maxum, and controlled start transmission. In addition, the company produces power transmission components include mechanical drive components, couplings, and conveyor components; engineered hydraulics and valves for aircraft and submarine applications, and aerospace and defense aftermarket services; fasteners; precision mechanical components, which are used in various general industrial applications; and machine tool collets that are used for holding circulars or rod-like pieces. It serves automotive, tool holding, agricultural and semiconductor machinery, commercial and defense aerospace, ground defense, construction and mining, oil and natural resource extraction, heavy truck, marine, rail and train, packaging, food and beverage, packaging and canning, wind, and general industrial markets through its direct sales force, as well as a network of industrial and aerospace distributors. The company was founded in 1919 and is headquartered in Oxford, Connecticut.