Franklin Electric Co., Inc. (FELE) vs Gates Industrial Corporation PLC (GTES)

Franklin Electric Co., Inc. and Gates Industrial Corporation PLC are both Specialty Industrial Machinery companies. Gates Industrial Corporation PLC is the larger, with a market value of $6.7B against $4.5B — 1.5× the size. Gates Industrial Corporation PLC trades at the lower P/E: 18.2× against 28.6×. Franklin Electric Co., Inc. grew revenue faster over the last twelve months: 7.38% against 3.34%. Gates Industrial Corporation PLC has the higher net margin (10.4% vs 7.02%) and the lower return on invested capital (5.42% vs 11.2%). Across the 22 metrics below, Gates Industrial Corporation PLC leads on 14 and Franklin Electric Co., Inc. on 8.

Valuation

Metric FELE GTES Specialty Industrial Machinery median
P/E 28.62 18.19 28.39
P/S 2.00 1.87 2.70
P/B 3.14 1.68 3.02
Price to free cash flow 19.96 17.25 23.32
EV/EBITDA 13.25 11.68 15.39
EV/Sales 2.07 2.29 2.81
Earnings yield 3.49% 5.50% 3.12%
Free cash flow yield 5.01% 5.80% 3.24%

Profitability

Metric FELE GTES Specialty Industrial Machinery median
Gross margin 35.52% 39.69% 35.90%
Operating margin 12.59% 13.27% 11.22%
Net margin 7.02% 10.37% 7.80%
Free cash flow margin 10.03% 10.84% 9.51%
Return on equity 11.62% 9.69% 10.50%
Return on assets 7.45% 4.98% 4.60%
Return on invested capital 11.19% 5.42% 5.36%

Growth

Metric FELE GTES Specialty Industrial Machinery median
Revenue growth (TTM) 7.38% 3.34% 6.45%
EPS growth (last fiscal year) (16.58%) 29.73% 4.97%
Revenue growth, 5-year CAGR 11.31% 4.27% 8.31%
Net income growth, 5-year CAGR 7.98% 25.92% 5.04%

Health

Metric FELE GTES Specialty Industrial Machinery median
Debt to equity 0.17 0.59 0.35
Current ratio 2.41 3.24 2.11
Net debt to EBITDA 0.20 2.18 1.32

Dividend

Metric FELE GTES Specialty Industrial Machinery median
Dividend yield 1.10% — 1.10%
Payout ratio 0.32 — 0.31

Size

Metric FELE GTES Specialty Industrial Machinery median
Market cap 4.45b 6.67b 1.91b

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