SPX FLOW (NYSE: FLOW) and Newport (NASDAQ:NEWP) are both industrials companies, but which is the better business? We will contrast the two companies based on the strength of their institutional ownership, earnings, valuation, profitability, dividends, risk and analyst recommendations.

Profitability

This table compares SPX FLOW and Newport’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SPX FLOW 1.17% 6.17% 1.90%
Newport 6.37% 10.63% 6.60%

Institutional & Insider Ownership

85.8% of SPX FLOW shares are held by institutional investors. 3.0% of SPX FLOW shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares SPX FLOW and Newport’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
SPX FLOW $2.00 billion 0.96 -$381.80 million $0.53 85.40
Newport N/A N/A N/A $0.78 29.47

Newport has lower revenue, but higher earnings than SPX FLOW. Newport is trading at a lower price-to-earnings ratio than SPX FLOW, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for SPX FLOW and Newport, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SPX FLOW 2 1 3 0 2.17
Newport 0 0 0 0 N/A

SPX FLOW presently has a consensus price target of $38.00, indicating a potential downside of 16.04%. Given SPX FLOW’s higher possible upside, analysts clearly believe SPX FLOW is more favorable than Newport.

Summary

SPX FLOW beats Newport on 5 of the 9 factors compared between the two stocks.

About SPX FLOW

SPX FLOW, Inc. is a global supplier of engineered solutions. As of December 31, 2016, the Company had operations in over 30 countries and sales in over 150 countries around the world. The Company operates in three business segments: Food and Beverage, Power and Energy, and Industrial. Its product portfolio of pumps, valves, mixers, filters, air dryers, hydraulic tools, homogenizers, separators and heat exchangers, along with the related aftermarket parts and services, supports global industries, including food and beverage, oil and gas, power generation, chemical processing, compressed air and mining. The Food and Beverage segment’s products include mixing, drying, evaporation and separation systems and components, heat exchangers, and reciprocating and centrifugal pump technologies. Its products in the Power and Energy segment include pumps, valves and the related accessories. Its products in the Industrial segment are filtration equipment, hydraulic technologies and heat exchangers.

About Newport

Newport Corporation is a supplier of technology products and systems. The Company offers its products and services to a range of industries, including scientific research, microelectronics, defense and security, life and health sciences, and industrial markets. The Company operates through three business segments: Photonics Group, which includes photonics instruments and systems, vibration isolation systems and subsystems, precision positioning systems and subsystems, optical components for research applications, optical hardware, and three-dimensional non-contact measurement sensors and equipment; Lasers Group, which offers a portfolio of laser technology products and services, including ultrafast lasers and amplifiers, fiber lasers, diode-pumped solid-state lasers, and high-energy pulsed lasers and tunable lasers, and Optics Group, which offers precision optics and lens assemblies, thin-film filters and coatings, replicated mirrors, and ruled and holographic diffraction gratings.

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