Luxfer (NYSE:LXFR) vs. Sumitomo Heavy (OTCMKTS:SOHVY) Critical Survey

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

Risk and Volatility

Luxfer has a beta of 1.1, meaning that its stock price is 10% more volatile than the S&P 500. Comparatively, Sumitomo Heavy has a beta of 0.23, meaning that its stock price is 77% less volatile than the S&P 500.

Dividends

Luxfer pays an annual dividend of $0.52 per share and has a dividend yield of 4.2%. Sumitomo Heavy pays an annual dividend of $0.13 per share and has a dividend yield of 2.0%. Luxfer pays out 98.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sumitomo Heavy pays out 185.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Luxfer is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

90.8% of Luxfer shares are held by institutional investors. 1.2% of Luxfer shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Luxfer	3.60%	11.58%	6.86%
Sumitomo Heavy	-0.29%	3.86%	1.97%

Analyst Recommendations

This is a breakdown of current ratings for Luxfer and Sumitomo Heavy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Luxfer	0	1	0	0	2.00
Sumitomo Heavy	0	0	0	0	0.00

Earnings & Valuation

This table compares Luxfer and Sumitomo Heavy”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Luxfer	$391.90 million	0.85	$18.40 million	$0.53	23.58
Sumitomo Heavy	$7.08 billion	0.45	$50.97 million	$0.07	94.29

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

Summary

Luxfer beats Sumitomo Heavy on 12 of the 14 factors compared between the two stocks.

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.

About Sumitomo Heavy

Sumitomo Heavy Industries, Ltd. manufactures and sells general machinery, advanced precision machinery, construction machinery, ships, and environmental plant facilities in Japan and internationally. Its Mechatronics segment offers gearmotors, gearboxes, motion control drives, motors and inverters, drive solutions, precision positioning equipment, laser systems, control systems, motion components, and collaborative robot. The company's Industrial Machinery segment provides injection molding machines, cryocoolers, ion implanters, PET tracer production systems, vacuum coasting equipment, steel tube air forming, non-destructive inspections, clean room system, cast iron and steel rolls for hot rolling, and coolant systems. Its Logistics & Construction segment offers hydraulic excavators, crawler cranes, material handing systems, parking systems, transfer molding presses, cryopumps, proton therapy systems, forging presses, lifting magnets, spinning machines, dust collectors, surface grinding machines, extrusion coating line, road machinery, foundation machines, logistics systems, and forklifts. The company's Energy & Lifelines segment provides circulating fluidized bed (CFB) boilers, liquid air energy storage, electrostatic precipitators, evaporation and crystallization facilities, waste heat boilers, CFB scrubbers, flue gas denitrification systems, industrial wastewater treatment facilities, steam turbines, distillation technology and extractors, mixing vessels, and food and beverage manufacturing facilities. This segment also offers bubbling fluidized bed boilers, rotary kiln-type recycling facilities, ash handling systems, fluidized bed gasifiers, waste-to-energy plants baghouses, digital services, water and sewage treatment systems, process pumps, reactor vessels, coke oven machines, and oils tankers. The company provides IT solutions and security services. Sumitomo Heavy Industries, Ltd. was founded in 1888 and is headquartered in Tokyo, Japan.