Analyzing Helios Technologies (NASDAQ:HLIO) and Watts Water Technologies (NASDAQ:WTS)
Helios Technologies (NASDAQ:HLIO) and Watts Water Technologies (NYSE:WTS) are both industrial products companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, profitability, risk, institutional ownership, dividends, valuation and earnings.
Volatility & Risk
Helios Technologies has a beta of 1.85, indicating that its share price is 85% more volatile than the S&P 500. Comparatively, Watts Water Technologies has a beta of 1.22, indicating that its share price is 22% more volatile than the S&P 500.
This table compares Helios Technologies and Watts Water Technologies’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Helios Technologies||$508.05 million||2.93||$46.73 million||$2.30||20.20|
|Watts Water Technologies||$1.56 billion||2.03||$128.00 million||$3.74||24.98|
Watts Water Technologies has higher revenue and earnings than Helios Technologies. Helios Technologies is trading at a lower price-to-earnings ratio than Watts Water Technologies, indicating that it is currently the more affordable of the two stocks.
Helios Technologies pays an annual dividend of $0.36 per share and has a dividend yield of 0.8%. Watts Water Technologies pays an annual dividend of $0.92 per share and has a dividend yield of 1.0%. Helios Technologies pays out 15.7% of its earnings in the form of a dividend. Watts Water Technologies pays out 24.6% 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. Watts Water Technologies has raised its dividend for 6 consecutive years. Watts Water Technologies is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Institutional & Insider Ownership
84.6% of Helios Technologies shares are held by institutional investors. Comparatively, 75.8% of Watts Water Technologies shares are held by institutional investors. 6.3% of Helios Technologies shares are held by insiders. Comparatively, 0.8% of Watts Water Technologies shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This is a breakdown of current ratings and price targets for Helios Technologies and Watts Water Technologies, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Watts Water Technologies||0||3||3||0||2.50|
Helios Technologies presently has a consensus target price of $44.50, suggesting a potential downside of 4.24%. Watts Water Technologies has a consensus target price of $94.07, suggesting a potential upside of 0.69%. Given Watts Water Technologies’ stronger consensus rating and higher probable upside, analysts clearly believe Watts Water Technologies is more favorable than Helios Technologies.
This table compares Helios Technologies and Watts Water Technologies’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Watts Water Technologies||8.10%||14.93%||7.97%|
Watts Water Technologies beats Helios Technologies on 11 of the 17 factors compared between the two stocks.
About Helios Technologies
Helios Technologies, Inc. develops, manufactures, and sells solutions for the hydraulics and electronics markets. The company operates through two segments, Hydraulics and Electronics. The Hydraulics segment offers screw-in hydraulic cartridge valves, electro-hydraulics, manifolds, and integrated package solutions for the industrial and mobile hydraulics markets; quick release hydraulic coupling solutions for the agriculture, construction equipment, and industrial markets; and hydraulic, pneumatic, electronic, and instrumentation solutions to a range of industries, including agriculture, industrial, mining, and material handling. The Electronics segment designs and manufactures electronic control, display, and instrumentation solutions for recreational and off-highway vehicles, as well as stationary and power generation equipment; and electronic controller products. The company sells its hydraulic products primarily through value-add distributors, as well as directly to original equipment manufacturer customers; and electronic products to original equipment manufacturer customers. It provides its products in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company was formerly known as Sun Hydraulics Corporation. Helios Technologies, Inc. was founded in 1970 and is headquartered in Sarasota, Florida.
About Watts Water Technologies
Watts Water Technologies, Inc. designs, manufactures, and sells products and systems that manage and conserve the flow of fluids and energy into, through and out of buildings in the residential and commercial markets. The company offers residential and commercial flow control products, including backflow preventers, water pressure regulators, temperature and pressure relief valves, and thermostatic mixing valves. It also provides heating, ventilation, and air conditioning and gas products, such as boilers, water heaters, and heating solution; hydronic and electric heating systems for under-floor radiant applications; custom heat and hot water solutions; hydronic pump groups for boiler manufacturers and alternative energy control packages; and flexible stainless steel connectors for natural and liquid propane gas in commercial food service and residential applications. In addition, the company offers drainage and water re-use products comprising drainage products and engineered rain water harvesting solutions for commercial, industrial, marine, and residential applications; and water quality products that include point-of-use and point-of-entry water filtration, conditioning, and scale prevention systems for commercial and residential applications. It sells its products to plumbing, heating, and mechanical wholesale distributors and dealers, as well as original equipment manufacturers, specialty product distributors, and do-it-yourself chains; and directly to wholesalers and private label accounts. The company has operations in the Americas, Europe, the Asia-Pacific, the Middle East, and Africa. Watts Water Technologies, Inc. was founded in 1874 and is headquartered in North Andover, Massachusetts.
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