Head to Head Analysis: NOW (NYSE:DNOW) and Applied Industrial Technologies (AIT)
NOW (NYSE: DNOW) and Applied Industrial Technologies (NYSE:AIT) are both oils/energy companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, earnings, profitability, institutional ownership, valuation and analyst recommendations.
This is a summary of current recommendations and price targets for NOW and Applied Industrial Technologies, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Applied Industrial Technologies||0||2||0||0||2.00|
NOW currently has a consensus price target of $19.33, indicating a potential upside of 58.86%. Applied Industrial Technologies has a consensus price target of $63.00, indicating a potential upside of 13.62%. Given NOW’s stronger consensus rating and higher probable upside, equities analysts plainly believe NOW is more favorable than Applied Industrial Technologies.
Applied Industrial Technologies pays an annual dividend of $1.16 per share and has a dividend yield of 2.1%. NOW does not pay a dividend. Applied Industrial Technologies pays out 34.1% of its earnings in the form of a dividend. Applied Industrial Technologies has increased its dividend for 7 consecutive years.
This table compares NOW and Applied Industrial Technologies’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Applied Industrial Technologies||4.20%||15.70%||8.15%|
Earnings & Valuation
This table compares NOW and Applied Industrial Technologies’ gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|NOW||$2.34 billion||0.56||-$81.00 million||($1.56)||-7.80|
|Applied Industrial Technologies||$2.55 billion||0.85||$208.18 million||$3.40||16.31|
Applied Industrial Technologies has higher revenue and earnings than NOW. NOW is trading at a lower price-to-earnings ratio than Applied Industrial Technologies, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
99.1% of NOW shares are held by institutional investors. Comparatively, 87.5% of Applied Industrial Technologies shares are held by institutional investors. 3.3% of NOW shares are held by company insiders. Comparatively, 4.4% of Applied Industrial Technologies shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Risk & Volatility
NOW has a beta of 0.76, suggesting that its stock price is 24% less volatile than the S&P 500. Comparatively, Applied Industrial Technologies has a beta of 0.95, suggesting that its stock price is 5% less volatile than the S&P 500.
Applied Industrial Technologies beats NOW on 11 of the 16 factors compared between the two stocks.
NOW Inc. (NOW) is a global distributor to the oil and gas and industrial markets. The Company operates under the DistributionNOW and Wilson Export brands. Its segments include the United States, Canada and International. As of December 31, 2016, its segments, the United States, Canada and International, had over 200, 55 and 35 locations, respectively. The United States segment comprises United States Energy, United States Supply Chain and United States Process Solutions. NOW’s energy product offerings are used in the oil and gas industry, including upstream drilling and completion, exploration and production, midstream infrastructure development and downstream petroleum refining, as well as in other industries, such as chemical processing, power generation and industrial manufacturing operations. It provides supply chain management to drilling contractors, exploration and production (E&P) operators, midstream operators, downstream energy and industrial manufacturing companies.
About Applied Industrial Technologies
Applied Industrial Technologies, Inc. is an industrial distributor in North America, Australia and New Zealand, serving maintenance, repair and operations (MRO), and original equipment manufacturing customers in various industries. In addition, the Company provides engineering, design, and systems integration for industrial and fluid power applications, as well as customized mechanical, fabricated rubber, and fluid power shop services. It operates in two segments: service center-based distribution and fluid power businesses. The service center-based distribution segment provides customers with a range of industrial products primarily through a network of service centers. The fluid power businesses segment consists of specialized regional companies that distribute fluid power components, design and assemble fluid power systems, and perform equipment repair. The fluid power businesses primarily sell products and services directly to customers rather than through the service centers.
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