Financial Review: Reliance (NYSE:RS) & QXO (NYSE:QXO)

QXO (NYSE:QXO) and Reliance (NYSE:RS) are both large-cap industrials companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, profitability, valuation, institutional ownership, earnings, dividends and risk.

Earnings and Valuation

This table compares QXO and Reliance”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
QXO	$8.56 billion	1.96	-$279.40 million	($0.91)	-17.76
Reliance	$14.29 billion	1.52	$739.40 million	$17.20	24.66

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

Insider & Institutional Ownership

58.7% of QXO shares are owned by institutional investors. Comparatively, 79.3% of Reliance shares are owned by institutional investors. 41.0% of QXO shares are owned by company insiders. Comparatively, 0.4% of Reliance shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares QXO and Reliance’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
QXO	-6.02%	1.91%	1.02%
Reliance	5.65%	12.51%	8.47%

Risk & Volatility

QXO has a beta of 2.28, indicating that its stock price is 128% more volatile than the S&P 500. Comparatively, Reliance has a beta of 0.96, indicating that its stock price is 4% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for QXO and Reliance, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
QXO	1	1	14	1	2.88
Reliance	1	5	2	1	2.33

QXO currently has a consensus price target of $29.71, indicating a potential upside of 83.82%. Reliance has a consensus price target of $378.67, indicating a potential downside of 10.74%. Given QXO’s stronger consensus rating and higher possible upside, research analysts clearly believe QXO is more favorable than Reliance.

Summary

Reliance beats QXO on 8 of the 14 factors compared between the two stocks.

About QXO

QXO, Inc. operates as a business application, technology, and consulting company in North America. The company provides solutions for accounting and business management, financial reporting, enterprise resource planning, human capital management, warehouse management systems, customer relationship management, and business intelligence. It also offers value-added services that focuses on consulting and professional, specialized programming, training, and technical support services. In addition, the company provides information technology managed services, such as cybersecurity, application hosting, disaster recovery, business continuity, cloud, and other services; and data back-up, network maintenance, and upgrade services. It serves small and medium-sized businesses primarily in the manufacturing, distribution, and service industries. QXO, Inc. is headquartered in Greenwich, Connecticut.

About Reliance

Reliance, Inc. operates as a diversified metal solutions provider and the metals service center company in the United States, Canada, and internationally. The company distributes a line of approximately 100,000 metal products, including alloy, aluminum, brass, copper, carbon steel, stainless steel, titanium, and specialty steel products; and provides metals processing services to general manufacturing, non-residential construction, transportation, aerospace, energy, electronics and semiconductor fabrication, and heavy industries. It sells its products directly to original equipment manufacturers, which primarily include small machine shops and fabricators. The company was formerly known as Reliance Steel & Aluminum Co. and changed its name to Reliance, Inc. in February 2024. Reliance, Inc. was founded in 1939 and is based in Scottsdale, Arizona.