NSK vs Timken Which Is More Attractive?

NSK and Timken are two leading companies in the manufacturing of industrial and automotive bearings. Investors often compare the stocks of these companies to determine which one presents a better opportunity for growth and profitability. While both companies have strong financial performance and global presence, their market strategies, product innovations, and customer base differ. Understanding the strengths and weaknesses of NSK and Timken stocks can help investors make informed decisions to maximize their investment portfolios.

NSK or Timken?

When comparing NSK and Timken, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between NSK and Timken.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. NSK has a dividend yield of 4.77%, while Timken has a dividend yield of 1.35%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. NSK reports a 5-year dividend growth of -6.06% year and a payout ratio of 149.48%. On the other hand, Timken reports a 5-year dividend growth of 3.21% year and a payout ratio of 28.04%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with NSK P/E ratio at 33.41 and Timken's P/E ratio at 15.45. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. NSK P/B ratio is 0.51 while Timken's P/B ratio is 1.79.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, NSK has seen a 5-year revenue growth of -0.16%, while Timken's is 0.44%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with NSK's ROE at 1.51% and Timken's ROE at 12.46%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ¥667.20 for NSK and $74.07 for Timken. Over the past year, NSK's prices ranged from ¥651.10 to ¥904.00, with a yearly change of 38.84%. Timken's prices fluctuated between $71.57 and $94.71, with a yearly change of 32.33%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.