Otis Worldwide (NYSE:OTIS) versus DXP Enterprises (NASDAQ:DXPE) Financial Review

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

Volatility & Risk

Otis Worldwide has a beta of 0.95, suggesting that its stock price is 5% less volatile than the S&P 500. Comparatively, DXP Enterprises has a beta of 1.07, suggesting that its stock price is 7% more volatile than the S&P 500.

Valuation & Earnings

This table compares Otis Worldwide and DXP Enterprises”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Otis Worldwide	$14.43 billion	1.95	$1.38 billion	$3.76	19.49
DXP Enterprises	$2.02 billion	1.13	$88.68 million	$5.35	27.34

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

Analyst Recommendations

This is a summary of current ratings and recommmendations for Otis Worldwide and DXP Enterprises, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Otis Worldwide	1	7	3	0	2.18
DXP Enterprises	0	2	2	0	2.50

Otis Worldwide presently has a consensus target price of $97.64, suggesting a potential upside of 33.26%. DXP Enterprises has a consensus target price of $154.00, suggesting a potential upside of 5.29%. Given Otis Worldwide’s higher probable upside, equities analysts clearly believe Otis Worldwide is more favorable than DXP Enterprises.

Institutional & Insider Ownership

88.0% of Otis Worldwide shares are held by institutional investors. Comparatively, 74.8% of DXP Enterprises shares are held by institutional investors. 0.1% of Otis Worldwide shares are held by company insiders. Comparatively, 22.7% of DXP Enterprises shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Otis Worldwide and DXP Enterprises’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Otis Worldwide	10.11%	-29.39%	14.86%
DXP Enterprises	4.27%	18.16%	5.70%

Summary

Otis Worldwide beats DXP Enterprises on 8 of the 14 factors compared between the two stocks.

About Otis Worldwide

Otis Worldwide Corporation engages in manufacturing, installation, and servicing of elevators and escalators in the United States, China, and internationally. The company operates in two segments, New Equipment and Service. The New Equipment segment designs, manufactures, sells, and installs a range of passenger and freight elevators, as well as escalators and moving walkways for residential and commercial buildings, and infrastructure projects. This segment serves real-estate and building developers, and general contractors. It sells its products directly to customers, as well as through agents and distributors. The Service segment performs maintenance and repair services, as well as modernization services to upgrade elevators and escalators. Otis Worldwide Corporation was founded in 1853 and is headquartered in Farmington, Connecticut.

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.