Critical Analysis: Xylem (XYL) & Ampco-Pittsburgh Corporation (AP)
Xylem (NYSE: XYL) and Ampco-Pittsburgh Corporation (NYSE:AP) are both industrial products companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, profitability, dividends, valuation, earnings, risk and analyst recommendations.
Earnings and Valuation
This table compares Xylem and Ampco-Pittsburgh Corporation’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Xylem||$4.23 billion||2.67||$723.00 million||$1.55||40.50|
|Ampco-Pittsburgh Corporation||$389.05 million||0.52||$7.81 million||($5.94)||-2.78|
Xylem has higher revenue and earnings than Ampco-Pittsburgh Corporation. Ampco-Pittsburgh Corporation is trading at a lower price-to-earnings ratio than Xylem, indicating that it is currently the more affordable of the two stocks.
This table compares Xylem and Ampco-Pittsburgh Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Xylem pays an annual dividend of $0.72 per share and has a dividend yield of 1.1%. Ampco-Pittsburgh Corporation pays an annual dividend of $0.36 per share and has a dividend yield of 2.2%. Xylem pays out 46.5% of its earnings in the form of a dividend. Ampco-Pittsburgh Corporation pays out -6.1% 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. Xylem has raised its dividend for 4 consecutive years. Ampco-Pittsburgh Corporation is clearly the better dividend stock, given its higher yield and lower payout ratio.
Institutional & Insider Ownership
86.5% of Xylem shares are held by institutional investors. Comparatively, 57.0% of Ampco-Pittsburgh Corporation shares are held by institutional investors. 0.8% of Xylem shares are held by insiders. Comparatively, 29.9% of Ampco-Pittsburgh Corporation shares are held 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 and Risk
Xylem has a beta of 1.17, meaning that its share price is 17% more volatile than the S&P 500. Comparatively, Ampco-Pittsburgh Corporation has a beta of 1.53, meaning that its share price is 53% more volatile than the S&P 500.
This is a breakdown of current recommendations for Xylem and Ampco-Pittsburgh Corporation, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Xylem currently has a consensus price target of $59.45, suggesting a potential downside of 5.30%. Ampco-Pittsburgh Corporation has a consensus price target of $22.00, suggesting a potential upside of 33.33%. Given Ampco-Pittsburgh Corporation’s stronger consensus rating and higher probable upside, analysts plainly believe Ampco-Pittsburgh Corporation is more favorable than Xylem.
Xylem beats Ampco-Pittsburgh Corporation on 10 of the 16 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 Ampco-Pittsburgh Corporation
Ampco-Pittsburgh Corporation is engaged in manufacturing and selling specialty metal products and customized equipment utilized by industry throughout the world. The Company operates through two segments: the Forged and Cast Engineered Products segment, and the Air and Liquid Processing segment. The Forged and Cast Engineered Products segment consists of Union Electric Steel Corporation (Union Electric Steel or UES) and Union Electric Steel UK Limited (UES-UK). The Air and Liquid Processing segment includes Aerofin, Buffalo Air Handling and Buffalo Pumps, all divisions of Air & Liquid Systems Corporation (Air and Liquid), a subsidiary of the Company. Union Electric Steel produces ingot and forged products that service a range of industries across the globe. UES-UK produces cast rolls for hot and cold strip mills, medium/heavy section mills and plate mills in a range of iron and steel qualities.
Receive News & Ratings for Xylem Inc. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Xylem Inc. and related companies with MarketBeat.com's FREE daily email newsletter.