Contrasting DNOW (NYSE:DNOW) and Sumitomo Heavy (OTCMKTS:SOHVY)

Sumitomo Heavy (OTCMKTS:SOHVY) and DNOW (NYSE:DNOW) are both industrials companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, valuation, dividends, risk, institutional ownership, analyst recommendations and profitability.

Analyst Ratings

This is a summary of recent ratings and target prices for Sumitomo Heavy and DNOW, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sumitomo Heavy	0	0	0	0	0.00
DNOW	0	1	2	1	3.00

DNOW has a consensus price target of $17.67, indicating a potential upside of 6.46%. Given DNOW’s stronger consensus rating and higher probable upside, analysts clearly believe DNOW is more favorable than Sumitomo Heavy.

Institutional & Insider Ownership

97.6% of DNOW shares are owned by institutional investors. 2.7% of DNOW 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.

Volatility & Risk

Sumitomo Heavy has a beta of 0.26, meaning that its share price is 74% less volatile than the S&P 500. Comparatively, DNOW has a beta of 0.79, meaning that its share price is 21% less volatile than the S&P 500.

Valuation and Earnings

This table compares Sumitomo Heavy and DNOW”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sumitomo Heavy	$7.08 billion	0.68	$50.97 million	$0.07	144.00
DNOW	$2.37 billion	0.73	$81.00 million	$0.87	19.07

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

Profitability

This table compares Sumitomo Heavy and DNOW’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sumitomo Heavy	0.36%	4.86%	2.47%
DNOW	3.91%	9.35%	6.55%

Summary

DNOW beats Sumitomo Heavy on 13 of the 15 factors compared between the two stocks.

About Sumitomo Heavy

Sumitomo Heavy Industries, Ltd. manufactures and sells general machinery, advanced precision machinery, construction machinery, ships, and environmental plant facilities in Japan and internationally. Its Mechatronics segment offers gearmotors, gearboxes, motion control drives, motors and inverters, drive solutions, precision positioning equipment, laser systems, control systems, motion components, and collaborative robot. The company's Industrial Machinery segment provides injection molding machines, cryocoolers, ion implanters, PET tracer production systems, vacuum coasting equipment, steel tube air forming, non-destructive inspections, clean room system, cast iron and steel rolls for hot rolling, and coolant systems. Its Logistics & Construction segment offers hydraulic excavators, crawler cranes, material handing systems, parking systems, transfer molding presses, cryopumps, proton therapy systems, forging presses, lifting magnets, spinning machines, dust collectors, surface grinding machines, extrusion coating line, road machinery, foundation machines, logistics systems, and forklifts. The company's Energy & Lifelines segment provides circulating fluidized bed (CFB) boilers, liquid air energy storage, electrostatic precipitators, evaporation and crystallization facilities, waste heat boilers, CFB scrubbers, flue gas denitrification systems, industrial wastewater treatment facilities, steam turbines, distillation technology and extractors, mixing vessels, and food and beverage manufacturing facilities. This segment also offers bubbling fluidized bed boilers, rotary kiln-type recycling facilities, ash handling systems, fluidized bed gasifiers, waste-to-energy plants baghouses, digital services, water and sewage treatment systems, process pumps, reactor vessels, coke oven machines, and oils tankers. The company provides IT solutions and security services. Sumitomo Heavy Industries, Ltd. was founded in 1888 and is headquartered in Tokyo, Japan.

About DNOW

DNOW Inc. distributes downstream energy and industrial products for petroleum refining, chemical processing, LNG terminals, power generation utilities, and customer on-site locations in the United States, Canada, and internationally. The company provides consumable maintenance, repair, and operating supplies; pipes, manual and automated valves, fittings, flanges, gaskets, fasteners, electrical instrumentations, artificial lift, pumping solutions, valve actuation and modular process, and measurement and control equipment; and mill supplies, tools, safety supplies, and personal protective equipment, as well as artificial lift systems, coatings, and miscellaneous expendable items. It also offers original equipment manufacturer equipment, including pumps, generator sets, air compressors, dryers, blowers, mixers, and valves; modular oil and gas tank battery solutions; and application systems, work processes, parts integration, optimization solutions, and after-sales support services. In addition, the company provides supply chain and materials management; inventory planning and management, procurement, and warehouse management, as well as solutions for logistics, point of issue technology, project management, business process, and performance metrics reporting services. It serves customers in the upstream, midstream, and downstream sectors of the energy industry, including drilling contractors, well-servicing companies, independent and national oil and gas companies, midstream operators, and refineries, as well as petrochemical, chemical, utilities, RNG facilities, and other downstream energy processors; and industrial and manufacturing companies. The company was formerly known as NOW Inc. and changed its name to DNOW Inc. in January 2024. DNOW Inc. was founded in 1862 and is headquartered in Houston, Texas.