Pentair (NYSE:PNR) versus Veralto (NYSE:VLTO) Head-To-Head Contrast

Veralto (NYSE:VLTO) and Pentair (NYSE:PNR) are both large-cap business services companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, analyst recommendations, earnings, valuation, dividends and institutional ownership.

Dividends

Veralto pays an annual dividend of $0.44 per share and has a dividend yield of 0.4%. Pentair pays an annual dividend of $1.00 per share and has a dividend yield of 0.9%. Veralto pays out 12.1% of its earnings in the form of a dividend. Pentair pays out 25.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Veralto has increased its dividend for 1 consecutive years and Pentair has increased its dividend for 7 consecutive years. Pentair is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Veralto and Pentair’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Veralto	16.75%	38.69%	13.80%
Pentair	15.84%	21.83%	12.10%

Insider and Institutional Ownership

91.3% of Veralto shares are held by institutional investors. Comparatively, 92.4% of Pentair shares are held by institutional investors. 0.4% of Veralto shares are held by insiders. Comparatively, 1.1% of Pentair shares are held by 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.

Volatility and Risk

Veralto has a beta of 0.89, suggesting that its stock price is 11% less volatile than the S&P 500. Comparatively, Pentair has a beta of 1.14, suggesting that its stock price is 14% more volatile than the S&P 500.

Earnings and Valuation

This table compares Veralto and Pentair”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Veralto	$5.19 billion	4.97	$833.00 million	$3.65	28.49
Pentair	$4.13 billion	4.20	$625.40 million	$3.94	26.91

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

Analyst Recommendations

This is a summary of current ratings and target prices for Veralto and Pentair, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Veralto	0	5	7	0	2.58
Pentair	1	3	11	2	2.82

Veralto currently has a consensus target price of $115.11, suggesting a potential upside of 10.69%. Pentair has a consensus target price of $120.21, suggesting a potential upside of 13.37%. Given Pentair’s stronger consensus rating and higher possible upside, analysts plainly believe Pentair is more favorable than Veralto.

Summary

Pentair beats Veralto on 10 of the 18 factors compared between the two stocks.

About Veralto

Veralto Corporation provides water analytics, water treatment, marking and coding, and packaging and color services worldwide. It operates through two segments, Water Quality (WQ) and Product Quality & Innovation (PQI). The WQ segment offers precision instrumentation and water treatment technologies to measure, analyze, and treat water in residential, commercial, municipal, industrial, research, and natural resource applications through the Hach, Trojan Technologies, and ChemTreat brands. This segment provides water solutions, including chemical reagents, services, and digital solutions. The PQI segment offers inline printing solutions for products and packaging with marking and coding systems; marking and coding for packaged goods and related consumables; design software and imaging systems for the creation of new packaging designs; color management solutions for printed packages and consumer and industrial products; color standard services for the design industry; and a software solution that provides digital asset management, marketing resource management, and product information management. This segment sells its products and services through the Videojet, Linx, Esko, X-Rite, and Pantone brands to regulated industries, including municipal utilities, food and beverage, pharmaceutical, and industrials. The company was formerly known as DH EAS Holding Corp. and changed its name to Veralto Corporation in February 2023. Veralto Corporation was incorporated in 2022 and is headquartered in Waltham, Massachusetts.

About Pentair

Pentair plc provides various water solutions in the United States, Western Europe, China, Eastern Europe, Latin America, the Middle East, Southeast Asia, Australia, Canada, and Japan. The company operates through three segments: Flow, Water Solutions, and Pool. The Flow segment designs, manufactures, and sells fluid treatment and pump products and systems, including pressure vessels, gas recovery solutions, membrane bioreactors, wastewater reuse systems and advanced membrane filtration, separation systems, water disposal pumps, water supply pumps, fluid transfer pumps, turbine pumps, solid handling pumps, and agricultural spray nozzles for fluid delivery, ion exchange, desalination, food and beverage, separation technologies in the oil and gas industry, residential and municipal wells, water treatment, wastewater solids handling, pressure boosting, circulation and transfer, fire suppression, flood control, agricultural irrigation, and crop spray in residential, commercial, and industrial markets. The Water Solutions segment provides commercial and residential water treatment products and systems, including pressure tanks, control valves, activated carbon products, commercial ice machines, conventional filtration products, and point-of-entry and point-of-use water treatment systems, as well as installation and preventative services for use in residential whole home water filtration, drinking water filtration, and water softening solutions, as well as commercial total water management and filtration in foodservice operations. The Pool segment provides residential and commercial pool equipment and accessories comprising pumps, filters, heaters, lights, automatic controls, automatic cleaners, maintenance equipment, and pool accessories for applications in residential and commercial pool maintenance, pool repair, renovation, service, and construction and aquaculture solutions. Pentair plc was founded in 1966 and is headquartered in London, the United Kingdom.