Financial Analysis: DistributionNOW (NYSE:DNOW) and Its Rivals

DistributionNOW (NYSE: DNOW) is one of 14 public companies in the “Oil & gas field machinery” industry, but how does it contrast to its peers? We will compare DistributionNOW to related businesses based on the strength of its earnings, dividends, risk, analyst recommendations, valuation, profitability and institutional ownership.

Risk & Volatility

DistributionNOW has a beta of 0.83, indicating that its share price is 17% less volatile than the S&P 500. Comparatively, DistributionNOW’s peers have a beta of 0.94, indicating that their average share price is 6% less volatile than the S&P 500.



Institutional and Insider Ownership

64.9% of shares of all “Oil & gas field machinery” companies are owned by institutional investors. 3.5% of DistributionNOW shares are owned by company insiders. Comparatively, 18.9% of shares of all “Oil & gas field machinery” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares DistributionNOW and its peers top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
DistributionNOW $2.65 billion -$52.00 million -56.11
DistributionNOW Competitors $3.65 billion -$224.01 million 16.93

DistributionNOW’s peers have higher revenue, but lower earnings than DistributionNOW. DistributionNOW is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares DistributionNOW and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
DistributionNOW -0.97% -1.01% -0.68%
DistributionNOW Competitors -7.23% -24.97% -0.36%

Analyst Ratings

This is a breakdown of current ratings and target prices for DistributionNOW and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
DistributionNOW 0 7 4 0 2.36
DistributionNOW Competitors 150 901 880 20 2.39

DistributionNOW currently has a consensus price target of $13.00, suggesting a potential downside of 14.19%. As a group, “Oil & gas field machinery” companies have a potential downside of 5.30%. Given DistributionNOW’s peers stronger consensus rating and higher probable upside, analysts plainly believe DistributionNOW has less favorable growth aspects than its peers.

Summary

DistributionNOW peers beat DistributionNOW on 10 of the 13 factors compared.

About DistributionNOW

NOW Inc. distributes energy and industrial products in the United States, Canada, and internationally. It offers consumable maintenance, repair, and operating supplies; and pipes, valves, fittings, flanges, gaskets, fasteners, electrical products, instrumentations, artificial lift, pumping solutions, valve actuation and modular process, measurement and control equipment, process equipment, pumps, OEM parts, coatings, mill supplies, and safety supplies, as well as provides application systems, work processes, parts integration, optimization solutions, and after-sales support services. The company also provides supply chain and materials management solutions that include procurement, inventory and warehouse management, logistics, point of issue technology, project management, business process, and performance metrics reporting. It offers its products under the DistributionNOW and Wilson Export brand names. The company serves customers in the upstream, midstream, and downstream sectors of the energy industry, including drilling contractors, well servicing companies, independent and national oil and gas companies, midstream operators, and refineries, as well as petrochemical, chemical, utilities, and other downstream energy processors; and industrial and manufacturing companies. NOW Inc. was incorporated in 2013 and is headquartered in Houston, Texas.

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