Xylem (XYL) and Flowserve Corporation (NYSE:FLS) Head-To-Head Analysis
Xylem (NYSE: XYL) and Flowserve Corporation (NYSE:FLS) are both mid-cap industrial products companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, valuation, analyst recommendations, earnings, institutional ownership and profitabiliy.
This is a summary of current ratings and recommmendations for Xylem and Flowserve Corporation, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Xylem presently has a consensus price target of $56.42, suggesting a potential upside of 0.56%. Flowserve Corporation has a consensus price target of $50.44, suggesting a potential upside of 9.26%. Given Flowserve Corporation’s higher possible upside, analysts plainly believe Flowserve Corporation is more favorable than Xylem.
Xylem pays an annual dividend of $0.72 per share and has a dividend yield of 1.3%. Flowserve Corporation pays an annual dividend of $0.76 per share and has a dividend yield of 1.6%. Xylem pays out 50.4% of its earnings in the form of a dividend. Flowserve Corporation pays out 81.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Xylem has raised its dividend for 10 consecutive years and Flowserve Corporation has raised its dividend for 4 consecutive years.
Insider and Institutional Ownership
85.5% of Xylem shares are owned by institutional investors. 0.8% of Xylem shares are owned by company insiders. Comparatively, 0.5% of Flowserve Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Earnings and Valuation
This table compares Xylem and Flowserve Corporation’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Xylem||$4.00 billion||2.52||$665.00 million||$1.43||39.23|
|Flowserve Corporation||$3.91 billion||1.54||$445.71 million||$0.93||49.65|
Xylem has higher revenue and earnings than Flowserve Corporation. Xylem is trading at a lower price-to-earnings ratio than Flowserve Corporation, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Xylem has a beta of 1.18, suggesting that its share price is 18% more volatile than the S&P 500. Comparatively, Flowserve Corporation has a beta of 1.48, suggesting that its share price is 48% more volatile than the S&P 500.
This table compares Xylem and Flowserve Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Xylem beats Flowserve Corporation on 13 of the 17 factors compared between the two stocks.
Xylem Inc. is a water technology company. The Company designs, manufactures and services engineered solutions across a range of critical applications. It is an equipment and service provider for water and wastewater applications with a portfolio of products and services addressing the cycle of water, from collection, distribution and use to the return of water to the environment. It has three business segments, which include Water Infrastructure, Applied Water and Sensus. Water Infrastructure focuses on the transportation, treatment and testing of water, offering a range of products, including water and wastewater pumps, and controls and systems. Applied Water serves the uses of water and focuses on the residential, commercial, industrial and agricultural markets. The Sensus segment’s products include metering, networked communications, measurement and control technologies, software and services, including cloud-based analytics, remote monitoring and data management.
About Flowserve Corporation
Flowserve Corporation is a manufacturer and aftermarket service provider of flow control systems. The Company’s segments include Engineered Product Division, Industrial Product Division and Flow Control Division. Its geographic segments include North America, Europe, Asia Pacific, Middle East and Africa, and Latin America. It develops and manufactures precision-engineered flow control equipment integral to the movement, control and protection of the flow of materials in its customer’s critical processes. Its product portfolio of pumps, valves, seals, automation and aftermarket services supports infrastructure industries, including oil and gas, chemical, power generation and water management. It offers aftermarket equipment services, such as installation, diagnostics, repair and retrofitting through manufacturing platform and network of Quick Response Centers. Its products include oil and gas, general industries, chemical, power generation and water management.
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