Contrasting Linde (LIN) & NL Industries (NL)

Linde (NYSE:LIN) and NL Industries (NYSE:NL) are both oils/energy companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, risk, institutional ownership, earnings, profitability, valuation and analyst recommendations.

Analyst Ratings

This is a breakdown of current ratings and price targets for Linde and NL Industries, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Linde 1 4 5 0 2.40
NL Industries 0 1 0 0 2.00

Linde presently has a consensus price target of $181.50, suggesting a potential upside of 14.12%. NL Industries has a consensus price target of $14.00, suggesting a potential upside of 230.19%. Given NL Industries’ higher possible upside, analysts clearly believe NL Industries is more favorable than Linde.

Institutional & Insider Ownership

86.3% of Linde shares are owned by institutional investors. Comparatively, 9.6% of NL Industries shares are owned by institutional investors. 45.9% of Linde shares are owned by insiders. Comparatively, 0.1% of NL Industries shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Linde and NL Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Linde 11.93% 28.54% 9.41%
NL Industries 4.66% 5.03% 2.99%

Earnings & Valuation

This table compares Linde and NL Industries’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Linde $11.44 billion 4.00 $1.25 billion $5.85 27.19
NL Industries $112.00 million 1.84 $116.10 million N/A N/A

Linde has higher revenue and earnings than NL Industries.

Dividends

Linde pays an annual dividend of $3.30 per share and has a dividend yield of 2.1%. NL Industries does not pay a dividend. Linde pays out 56.4% of its earnings in the form of a dividend.

Risk & Volatility

Linde has a beta of 0.92, meaning that its stock price is 8% less volatile than the S&P 500. Comparatively, NL Industries has a beta of 3.03, meaning that its stock price is 203% more volatile than the S&P 500.

Summary

Linde beats NL Industries on 12 of the 15 factors compared between the two stocks.

About Linde

Linde plc operates as an industrial gas and engineering company. The company offers oxygen, nitrogen, argon, rare gases, carbon monoxide, carbon dioxide, helium, hydrogen, electronic gases, specialty gases, acetylene, shielding gases, and noble gases, as well as develops and distributes procedures and systems for gas applications. It also offers pharmaceutical and medical gases and services to the healthcare industry; and support services, technical equipment, and safety products, as well as develops hydrogen technology. In addition, the company supplies wear-resistant and high-temperature corrosion-resistant metallic and ceramic coatings and powders; offers electric arc, plasma and wire spray, and high-velocity oxy-fuel equipment; and distributes hardgoods and welding equipment purchased from independent manufacturers. Further, it provides planning, project development, and construction services with a focus on market segments, such as olefin, natural gas, air separation, and hydrogen and synthesis gas plants. The company serves customers worldwide. Linde plc was founded in 1907 and is based in Guildford, the United Kingdom.

About NL Industries

NL Industries, Inc., through its subsidiary, CompX International Inc., operates in the component products industry in the United States and internationally. The company manufactures and sells mechanical and electronic cabinet locks, and other locking mechanisms, including disc tumbler locks, pin tumbler locking mechanisms, and CompX eLock and Stealthlock electronic locks for use in various applications, such as ignition systems, mailboxes, file cabinets, desk drawers, tool storage cabinets, vending and gaming machines, high security medical cabinetry, electronic circuit panels, storage compartments, and gas station security. It also offers original equipment and aftermarket stainless steel exhaust headers, exhaust pipes, mufflers, and other exhaust components; gauges, such as GPS speedometers and tachometers; mechanical and electronic controls and throttles; steering wheels and other billet aluminum accessories; and dash panels, LED lighting products, wire harnesses, and other accessories primarily for performance and ski/wakeboard boats. In addition, it offers insurance brokerage and risk management services. The company sells its component products directly to original equipment manufacturers, as well as through distributors. NL Industries, Inc. was founded in 1891 and is based in Dallas, Texas. NL Industries, Inc. is a subsidiary of Valhi, Inc.

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