Head-To-Head Contrast: Veralto (NYSE:VLTO) & Select Water Solutions (NYSE:WTTR)

Veralto (NYSE:VLTO) and Select Water Solutions (NYSE:WTTR) are both business services companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, profitability, institutional ownership, earnings, risk and analyst recommendations.

Institutional and Insider Ownership

91.3% of Veralto shares are owned by institutional investors. Comparatively, 81.7% of Select Water Solutions shares are owned by institutional investors. 0.4% of Veralto shares are owned by company insiders. Comparatively, 6.2% of Select Water Solutions shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of recent recommendations and price targets for Veralto and Select Water Solutions, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Veralto	0	6	5	0	2.45
Select Water Solutions	0	1	4	2	3.14

Veralto currently has a consensus target price of $105.88, suggesting a potential upside of 24.74%. Select Water Solutions has a consensus target price of $22.40, suggesting a potential upside of 16.39%. Given Veralto’s higher possible upside, equities research analysts clearly believe Veralto is more favorable than Select Water Solutions.

Valuation and Earnings

This table compares Veralto and Select Water Solutions”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Veralto	$5.59 billion	3.73	$940.00 million	$3.87	21.93
Select Water Solutions	$1.40 billion	1.90	$21.22 million	$0.21	91.65

Veralto has higher revenue and earnings than Select Water Solutions. Veralto is trading at a lower price-to-earnings ratio than Select Water Solutions, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Veralto and Select Water Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Veralto	17.33%	34.63%	13.44%
Select Water Solutions	1.54%	2.21%	1.34%

Dividends

Veralto pays an annual dividend of $0.52 per share and has a dividend yield of 0.6%. Select Water Solutions pays an annual dividend of $0.28 per share and has a dividend yield of 1.5%. Veralto pays out 13.4% of its earnings in the form of a dividend. Select Water Solutions pays out 133.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Veralto has increased its dividend for 1 consecutive years and Select Water Solutions has increased its dividend for 2 consecutive years. Select Water Solutions is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Veralto has a beta of 0.69, suggesting that its stock price is 31% less volatile than the S&P 500. Comparatively, Select Water Solutions has a beta of 1, suggesting that its stock price has a similar volatility profile to the S&P 500.

Summary

Veralto beats Select Water Solutions on 11 of the 18 factors compared between the two stocks.

About Veralto

Veralto Corporation provides water analytics, water treatment, marking and coding, and packaging and color services worldwide. It operates through two segments, Water Quality (WQ) and Product Quality & Innovation (PQI). The WQ segment offers precision instrumentation and water treatment technologies to measure, analyze, and treat water in residential, commercial, municipal, industrial, research, and natural resource applications through the Hach, Trojan Technologies, and ChemTreat brands. This segment provides water solutions, including chemical reagents, services, and digital solutions. The PQI segment offers inline printing solutions for products and packaging with marking and coding systems; marking and coding for packaged goods and related consumables; design software and imaging systems for the creation of new packaging designs; color management solutions for printed packages and consumer and industrial products; color standard services for the design industry; and a software solution that provides digital asset management, marketing resource management, and product information management. This segment sells its products and services through the Videojet, Linx, Esko, X-Rite, and Pantone brands to regulated industries, including municipal utilities, food and beverage, pharmaceutical, and industrials. The company was formerly known as DH EAS Holding Corp. and changed its name to Veralto Corporation in February 2023. Veralto Corporation was incorporated in 2022 and is headquartered in Waltham, Massachusetts.

About Select Water Solutions

Select Water Solutions, Inc., together with its subsidiaries, provides water management and chemical solutions to the energy industry in the United States. The company operates through three segments: Water Services, Water Infrastructure, and Chemical Technologies. The Water Services segment provides water-related services, including water sourcing, water transfer, flowback and well testing, water containment, fluids hauling, water monitoring, and water network automation; technology solutions comprising hydrographic mapping, water volume and quality monitoring, remote pit and tank monitoring, leak detection, asset and fuel tracking, and automated-equipment services, as well as various surface rental equipment and workforce accommodation services. The Water Infrastructure segment engages in the recycling, gathering, transferring, and disposal of water through a network of permanent pipeline infrastructure, semi-permanent pipeline infrastructure, water recycling facilities, earthen pits, water sources, and SWDs; provides solids management services; and develops, builds, and operates semi-permanent and permanent infrastructure solutions. The Chemical Technologies segment provides technical solutions, products, and services related to chemical applications in the oil and gas industry. This segment develops, manufactures, and manages logistics; and provides chemicals used in hydraulic fracturing, stimulation, cementing, and well completions for pressure pumpers and oil and gas producers, as well as offers production chemical solutions for underperforming wells, corrosion and scale monitoring, chemical inventory management, well failure analysis, and lab services. It primarily serves oil and gas producers. The company was formerly known as Select Energy Services, Inc. and changed its name to Select Water Solutions, Inc. in May 2023. Select Water Solutions, Inc. was incorporated in 2016 and is headquartered in Houston, Texas.