QXO (NYSE:QXO) & DXP Enterprises (NASDAQ:DXPE) Critical Comparison

DXP Enterprises (NASDAQ:DXPE) and QXO (NYSE:QXO) are both industrials companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, analyst recommendations and dividends.

Analyst Recommendations

This is a summary of current ratings and target prices for DXP Enterprises and QXO, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DXP Enterprises	0	2	2	0	2.50
QXO	1	1	14	1	2.88

DXP Enterprises presently has a consensus target price of $154.00, suggesting a potential downside of 22.30%. QXO has a consensus target price of $29.71, suggesting a potential upside of 95.15%. Given QXO’s stronger consensus rating and higher possible upside, analysts clearly believe QXO is more favorable than DXP Enterprises.

Risk & Volatility

DXP Enterprises has a beta of 0.98, indicating that its stock price is 2% less volatile than the S&P 500. Comparatively, QXO has a beta of 2.28, indicating that its stock price is 128% more volatile than the S&P 500.

Valuation and Earnings

This table compares DXP Enterprises and QXO”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DXP Enterprises	$2.02 billion	1.52	$88.68 million	$5.35	37.05
QXO	$6.84 billion	2.31	-$279.40 million	($0.91)	-16.73

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
DXP Enterprises	4.35%	18.89%	5.83%
QXO	-6.02%	1.91%	1.02%

Institutional & Insider Ownership

74.8% of DXP Enterprises shares are held by institutional investors. Comparatively, 58.7% of QXO shares are held by institutional investors. 22.0% of DXP Enterprises shares are held by insiders. Comparatively, 41.0% of QXO shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

QXO beats DXP Enterprises on 8 of the 15 factors compared between the two stocks.

About DXP Enterprises

DXP Enterprises, Inc., together with its subsidiaries, engages in distributing maintenance, repair, and operating (MRO) products, equipment, and services in the United States and Canada. It operates through three segments: Service Centers (SC), Supply Chain Services (SCS), and Innovative Pumping Solutions (IPS). The SC segment offers MRO products, equipment, and integrated services, including technical expertise and logistics services. It offers a range of MRO products in the rotating equipment, bearing, power transmission, hose, fluid power, metal working, fastener, industrial supply, safety products, and safety services categories. This segment serves customers in the oil and gas, food and beverage, petrochemical, transportation, other general industrial, mining, construction, chemical, municipal, agriculture, and pulp and paper industries. The SCS segment manages procurement and inventory vinventory optimization and management, storeroom management, transaction consolidation and control, vendor oversight and procurement cost optimization, productivity improvement, and customized reporting services. Its programs include SmartAgreement, a procurement solution for various MRO categories; SmartBuy, an on-site or centralized MRO procurement solution; SmartSource, an on-site procurement and storeroom management solution; SmartStore, an e-Catalog solution; SmartVend, an industrial dispensing solution; and SmartServ, an integrated service pump solution. The IPS segment fabricates and assembles custom-made pump packages; remanufactures pumps; and manufactures branded private label pumps. DXP Enterprises, Inc. was founded in 1908 and is based in Houston, Texas.

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.