Financial Analysis: Franklin Electric (FELE) versus IDEX Corporation (IEX)
Franklin Electric (NASDAQ: FELE) and IDEX Corporation (NYSE:IEX) are both industrials companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, risk, earnings, valuation, analyst recommendations, institutional ownership and profitability.
Insider & Institutional Ownership
77.7% of Franklin Electric shares are owned by institutional investors. Comparatively, 98.7% of IDEX Corporation shares are owned by institutional investors. 2.5% of Franklin Electric shares are owned by company insiders. Comparatively, 1.0% of IDEX Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Valuation and Earnings
This table compares Franklin Electric and IDEX Corporation’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Franklin Electric||$1.00 billion||1.82||$146.27 million||$1.84||21.33|
|IDEX Corporation||$2.19 billion||4.02||$554.19 million||$3.73||30.88|
IDEX Corporation has higher revenue and earnings than Franklin Electric. Franklin Electric is trading at a lower price-to-earnings ratio than IDEX Corporation, indicating that it is currently the more affordable of the two stocks.
Franklin Electric pays an annual dividend of $0.43 per share and has a dividend yield of 1.1%. IDEX Corporation pays an annual dividend of $1.48 per share and has a dividend yield of 1.3%. Franklin Electric pays out 23.4% of its earnings in the form of a dividend. IDEX Corporation pays out 39.7% 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. Franklin Electric has increased its dividend for 7 consecutive years and IDEX Corporation has increased its dividend for 7 consecutive years.
Risk and Volatility
Franklin Electric has a beta of 1.6, indicating that its stock price is 60% more volatile than the S&P 500. Comparatively, IDEX Corporation has a beta of 1.2, indicating that its stock price is 20% more volatile than the S&P 500.
This is a summary of recent recommendations for Franklin Electric and IDEX Corporation, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Franklin Electric presently has a consensus price target of $52.00, suggesting a potential upside of 32.48%. IDEX Corporation has a consensus price target of $101.57, suggesting a potential downside of 11.82%. Given Franklin Electric’s stronger consensus rating and higher probable upside, equities analysts plainly believe Franklin Electric is more favorable than IDEX Corporation.
This table compares Franklin Electric and IDEX Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
IDEX Corporation beats Franklin Electric on 9 of the 15 factors compared between the two stocks.
Franklin Electric Company Profile
Franklin Electric Co., Inc. designs, manufactures and distributes water and fuel pumping systems, consisting of submersible motors, pumps, electronic controls and related parts and equipment. Its segments include Water Systems segment, the Fueling Systems segment and Other. Its Water Systems segment is engaged in the production and marketing of water pumping systems and offers motors, pumps, drives, electronic controls and monitoring devices. It also designs, manufactures and sells motors, pumps, electronic controls and related parts and equipment for use in groundwater, wastewater and fuel transfer applications. Its Fueling Systems is engaged in the production and marketing of fuel pumping systems, fuel containment systems, and monitoring and control systems. It also designs, manufactures and sells pumps, pipe, sumps, fittings, vapor recovery components, electronic controls, monitoring devices and related parts and equipment for use in submersible fueling system applications.
IDEX Corporation Company Profile
IDEX Corporation (IDEX) operates an applied solutions business that sells pumps, flow meters and other fluidics systems, and components and engineered products. The Company operates through three segments: Fluid & Metering Technologies (FMT), Health & Science Technologies (HST) and Fire & Safety/Diversified Products (FSDP). With its segments, as of December 31, 2016, the Company maintained 13 platforms, where it focused on growth and acquisitions. The Company’s FMT segment provides flow monitoring and other services for the food, chemical, general industrial, water and wastewater, agricultural and energy industries. The HST segment designs, produces and distributes precision fluidics, rotary lobe pumps, centrifugal and positive displacement pumps, roll compaction and drying systems. Its FSDP segment produces firefighting pumps and controls, rescue tools, lifting bags and other components and systems; engineered stainless steel banding and clamping devices, and precision equipment.
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