Xylem (NYSE:XYL) and Luxfer (NYSE:LXFR) Critical Contrast

Xylem (NYSE:XYL) and Luxfer (NYSE:LXFR) are both industrials companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, earnings, risk, institutional ownership, profitability, analyst recommendations and valuation.

Earnings & Valuation

This table compares Xylem and Luxfer”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Xylem	$9.04 billion	2.69	$957.00 million	$4.20	24.81
Luxfer	$384.60 million	1.21	$7.70 million	$0.30	57.48

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

Dividends

Xylem pays an annual dividend of $1.72 per share and has a dividend yield of 1.7%. Luxfer pays an annual dividend of $0.52 per share and has a dividend yield of 3.0%. Xylem pays out 41.0% of its earnings in the form of a dividend. Luxfer pays out 173.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Xylem has raised its dividend for 2 consecutive years.

Risk & Volatility

Xylem has a beta of 1, indicating that its share price has a similar volatility profile to the S&P 500.Comparatively, Luxfer has a beta of 1.12, indicating that its share price is 12% more volatile than the S&P 500.

Insider and Institutional Ownership

88.0% of Xylem shares are owned by institutional investors. Comparatively, 90.8% of Luxfer shares are owned by institutional investors. 0.3% of Xylem shares are owned by company insiders. Comparatively, 2.0% of Luxfer shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Xylem and Luxfer’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Xylem	11.15%	11.77%	7.50%
Luxfer	2.20%	12.22%	7.23%

Analyst Ratings

This is a summary of current ratings and price targets for Xylem and Luxfer, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Xylem	0	7	9	0	2.56
Luxfer	0	2	0	1	2.67

Xylem presently has a consensus target price of $145.54, suggesting a potential upside of 39.66%. Given Xylem’s higher possible upside, analysts plainly believe Xylem is more favorable than Luxfer.

Summary

Xylem beats Luxfer on 10 of the 18 factors compared between the two stocks.

About Xylem

Xylem Inc., together with its subsidiaries, engages in the design, manufacture, and servicing of engineered products and solutions worldwide. It operates through four segments: Water Infrastructure, Applied Water, Measurement & Control Solutions, and Integrated Solutions and Services. The Water Infrastructure segment offers products, including water, storm water, and wastewater pumps; controls and systems; filtration, disinfection, and biological treatment equipment; and mobile dewatering equipment and rental services under the ADI, Flygt, Godwin, Sanitaire, Magneto, Neptune Benson, Ionpure, Leopold, Wedeco, and Xylem Vue brands. The Applied Water segment provides pumps, valves, heat exchangers, controls, and dispensing equipment systems under the Goulds Water Technology, Bell & Gossett, A-C Fire Pump, Standard Xchange, Lowara, Jabsco, Xylem Vue, and Flojet brands. The Measurement & Control Solutions segment offers smart meters, networked communication devices, data analytics, test equipment, controls, sensor devices, software and managed services, and critical infrastructure services; and software and services, including cloud-based analytics, remote monitoring and data management, leak detection, condition assessment, asset management, and pressure monitoring solutions, as well as testing equipment. This segment sells its products under the Pure Technologies, Sensus, Smith Blair, WTW, Xylem Vue, and YSI brands. The Integrated Solutions and Services segment provides maintenance services, mobile services, digital outsourced solutions, wastewater systems, environmental remediation, odor and corrosion control, filtration, reverse osmosis, ion exchange, and deionization under Aquapro, WaterOne, and Ion Pure brands. Xylem Inc. was formerly known as ITT WCO, Inc. and changed its name to Xylem Inc. in May 2011. Xylem Inc. was incorporated in 2011 and is headquartered in Washington, District of Columbia.

About Luxfer

Luxfer Holdings PLC, together with its subsidiaries, designs, manufactures, and supplies high-performance materials, components, and high-pressure gas containment devices for defense and first response, healthcare, transportation, and general industrial applications. The company operates through three segments: Elektron, Gas Cylinders, and graphic Arts. The Elektron segment focuses on specialty materials based primarily on magnesium and zirconium. This segment also provides magnesium alloys for use in aerospace, healthcare, and oil and gas applications; magnesium powders for use in countermeasure flares, as well as heater meals; and zirconium-based materials and oxides used as catalysts and in the manufacture of advanced ceramics, fiber-optic fuel cells, pharmaceuticals, and other performance products. The Gas Cylinders segment manufactures and markets specialized products using carbon composites and aluminum alloys, including pressurized cylinders for use in various applications comprising self-contained breathing apparatus (SCBA) for firefighters, containment of oxygen, and other medical gases for healthcare, alternative fuel vehicles, and general industrial applications. The Graphic Art segments provides magnesium photo-engraving plates, engraving metals, and etching chemicals. This segment also offers magnesium, copper, and zinc photo-engraving plates for graphic arts and luxury packaging; developer solutions; and solid wrought magnesium slab and sheet. Luxfer Holdings PLC has operations in the United States, the United Kingdom, Japan, Germany, Canada, rest of Europe, the Asia Pacific, and internationally. The company was founded in 1898 and is headquartered in Milwaukee, Wisconsin.