Donaldson (NYSE: DCI) and LiqTech International (NYSE:LIQT) are both industrial products companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, earnings, profitability, analyst recommendations, risk, institutional ownership and dividends.

Institutional and Insider Ownership

77.9% of Donaldson shares are held by institutional investors. 0.9% of Donaldson shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Donaldson pays an annual dividend of $0.72 per share and has a dividend yield of 1.6%. LiqTech International does not pay a dividend. Donaldson pays out 41.4% of its earnings in the form of a dividend. LiqTech International has raised its dividend for 32 consecutive years.

Earnings and Valuation

This table compares Donaldson and LiqTech International’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Donaldson $2.31 billion 2.51 $402.70 million $1.74 25.44
LiqTech International $12.15 million 1.53 -$5.38 million N/A N/A

Donaldson has higher revenue and earnings than LiqTech International.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Donaldson and LiqTech International, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Donaldson 0 4 1 0 2.20
LiqTech International 0 0 0 0 N/A

Donaldson currently has a consensus price target of $48.67, suggesting a potential upside of 9.93%. Given Donaldson’s higher probable upside, equities analysts plainly believe Donaldson is more favorable than LiqTech International.

Profitability

This table compares Donaldson and LiqTech International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Donaldson 9.81% 28.14% 12.15%
LiqTech International -40.75% -80.04% -42.36%

Summary

Donaldson beats LiqTech International on 11 of the 13 factors compared between the two stocks.

About Donaldson

Donaldson Company, Inc. is a manufacturer of filtration systems and replacement parts. The Company’s segments include Engine Products, Industrial Products and Corporate. The Company’s products are manufactured at approximately 44 plants around the world and through three joint ventures. The Company offers its products under the Ultra-Web, PowerCore and Donaldson brands. The Engine Products segment sells its products to original equipment manufacturers (OEMs) in the construction, mining, agriculture, aerospace, defense and truck end-markets and to independent distributors, OEM dealer networks, private label accounts and large equipment fleets. The Industrial Products segment sells to various industrial dealers, distributors, OEMs of gas-fired turbines and OEMs and end users requiring clean air. Its products include dust, fume and mist collectors, compressed air purification systems, air filtration systems for gas turbines and polytetrafluoroethylene (PTFE) membrane-based products.

About LiqTech International

LiqTech International, Inc. is a clean technology company that provides technologies for gas and liquid purification by manufacturing ceramic silicon carbide filters. The Company develops and manufactures products of re-crystallized silicon carbide. It specializes in two business areas, which include ceramic membranes for liquid filtration, and diesel particulate filters (DPFs) for the control of soot exhaust particles from diesel engines. Under the LiqTech, Cometas and Provital brand names, it manufactures and sells ceramic silicon carbide membranes and systems for liquid filtration using silicon carbide technology that focus on hydrocarbon production-derived contaminated water and pre-filtration for reverse osmosis. It offers DPFs for exhaust emission control solutions to the retrofit and the original equipment manufacturer markets. It also offers Kiln furniture, which refers to various items used in a kiln to support ceramics that maximizes the number of items for each firing.

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