DNOW (NYSE:DNOW – Get Free Report) and Regal Rexnord (NYSE:RRX – Get Free Report) are both industrials companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, profitability, earnings, dividends and risk.
Profitability
This table compares DNOW and Regal Rexnord’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| DNOW | 3.45% | 8.97% | 6.26% |
| Regal Rexnord | 4.28% | 9.73% | 4.46% |
Risk and Volatility
DNOW has a beta of 1.21, meaning that its stock price is 21% more volatile than the S&P 500. Comparatively, Regal Rexnord has a beta of 1.18, meaning that its stock price is 18% more volatile than the S&P 500.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| DNOW | 0 | 1 | 1 | 1 | 3.00 |
| Regal Rexnord | 0 | 0 | 8 | 0 | 3.00 |
DNOW currently has a consensus price target of $18.00, indicating a potential upside of 16.09%. Regal Rexnord has a consensus price target of $181.63, indicating a potential upside of 26.21%. Given Regal Rexnord’s higher probable upside, analysts plainly believe Regal Rexnord is more favorable than DNOW.
Institutional & Insider Ownership
97.6% of DNOW shares are owned by institutional investors. Comparatively, 99.7% of Regal Rexnord shares are owned by institutional investors. 2.7% of DNOW shares are owned by company insiders. Comparatively, 0.8% of Regal Rexnord shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Valuation & Earnings
This table compares DNOW and Regal Rexnord”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| DNOW | $2.37 billion | 0.70 | $81.00 million | $0.76 | 20.40 |
| Regal Rexnord | $6.03 billion | 1.58 | $196.20 million | $3.76 | 38.27 |
Regal Rexnord has higher revenue and earnings than DNOW. DNOW is trading at a lower price-to-earnings ratio than Regal Rexnord, indicating that it is currently the more affordable of the two stocks.
Summary
Regal Rexnord beats DNOW on 10 of the 14 factors compared between the two stocks.
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.
About Regal Rexnord
Regal Rexnord Corporation manufactures and sells industrial powertrain solutions, power transmission components, electric motors and electronic controls, air moving products, and specialty electrical components and systems worldwide. The Industrial Powertrain Solutions segment provides mounted and unmounted bearings, couplings, mechanical power transmission drives and components, gearboxes, gear motors, clutches, brakes, special, and industrial powertrain components and solutions for food and beverage, bulk material handling, eCommerce/warehouse distribution, energy, mining, marine, agricultural machinery, turf and garden, and general industrial markets. The Power Efficiency Solutions segment offers AC and DC motors, electronic variable speed controls, and blowers for residential, commercial HVAC, water heaters, commercial refrigeration, commercial building ventilation, pool and spa, irrigation, agriculture, conveying, and general commercial equipment markets. The Automation and Motion Control segment provides conveyor products, conveying automation subsystems, aerospace components, rotary precision motion solutions, high-efficiency miniature motors, motion controls, automation transfer switches, and switchgear for industrial applications and automation systems for material handling, aerospace and defense, factory automation, data centers, medical device, packaging, printing, semiconductor, robotic, industrial power tool, mobile off-highway, food and beverage processing, and other applications. The Industrial Systems segment offers integral motors, alternators, and aftermarket parts and kits for agriculture, marine, mining, oil and gas, food and beverage, data centers, prime and standby power, and general industrial equipment markets. It sells its products directly to original equipment manufacturers, distributors, and end-users. The company was formerly known as Regal Beloit Corporation. The company was founded in 1955 and is based in Milwaukee, Wisconsin.
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