Reviewing Itron (ITRI) and NL Industries (NL)

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

Profitability

This table compares Itron and NL Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Itron 3.42% 14.84% 6.26%
NL Industries 67.61% 33.69% 17.82%

Analyst Ratings

This is a breakdown of current recommendations for Itron and NL Industries, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Itron 0 4 4 1 2.67
NL Industries 1 0 0 0 1.00

Itron presently has a consensus target price of $82.00, indicating a potential upside of 9.63%. NL Industries has a consensus target price of $14.00, indicating a potential downside of 0.71%. Given Itron’s stronger consensus rating and higher possible upside, equities analysts clearly believe Itron is more favorable than NL Industries.

Institutional and Insider Ownership

93.5% of Itron shares are owned by institutional investors. Comparatively, 9.3% of NL Industries shares are owned by institutional investors. 2.0% of Itron shares are owned by insiders. Comparatively, 0.1% of NL Industries shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Volatility and Risk

Itron has a beta of 1, meaning that its stock price has a similar volatility profile to the S&P 500.Comparatively, NL Industries has a beta of 2.87, meaning that its stock price is 187% more volatile than the S&P 500.

Earnings & Valuation

This table compares Itron and NL Industries’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Itron $2.01 billion 1.44 $31.77 million $1.71 43.74
NL Industries $108.90 million 6.31 $15.32 million $1.58 8.92

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

Summary

Itron beats NL Industries on 10 of the 15 factors compared between the two stocks.

About Itron

Itron, Inc. (Itron) is a technology and service company. The Company provides solutions that measure, manage and analyze energy and water use. The Company operates through three segments: Electricity, Gas and Water. It provides a portfolio of products, solutions, software and services to electric, gas and water utility customers across the globe. It offers solutions that enable electric and natural gas utilities to build smart grids to manage assets. It offers a product portfolio, including standard meters and smart metering products, systems and services, for applications in the residential and commercial industrial markets for water and heat. The Company operates under the Itron brand across the world. Its Gas and Water manufacturing facilities are located throughout the world, while its Electricity manufacturing facilities are located in Europe, Middle East and Africa (EMEA), and North America.

About NL Industries

NL Industries, Inc. is a holding company. The Company operates in the component products industry through its subsidiary, CompX International Inc. (CompX). The Company operates in the chemicals industry through its non-controlling interest in Kronos Worldwide, Inc. (Kronos). The Company, through Compx, manufactures engineered components that are sold to a range of industries, including recreational transportation (including boats), postal, office and institutional furniture, cabinetry, tool storage, healthcare, gas stations and vending equipment. Kronos is a global producer and marketer of value-added titanium dioxide pigments (TiO2), a base industrial product used in imparting whiteness, brightness and opacity to a range of customer applications and end use markets, including coatings, plastics, paper, inks, food, cosmetics, and other industrial and consumer products. Kronos has production facilities in Europe and North America.

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