Select Water Solutions (NYSE:WTTR) and Sims Metal Management (OTCMKTS:SMSMY) are both small-cap companies operating in the business services sector. A recent analysis reveals key differences between these firms across various financial metrics, including earnings strength, institutional ownership, dividends, and risk assessment.
Institutional Ownership and Analyst Ratings
Institutional investors hold a significant stake in Select Water Solutions, with approximately 81.7% of its shares owned by these entities. This high level of institutional ownership suggests strong confidence from large money managers and hedge funds regarding the company’s future performance. In contrast, only 8.4% of Sims Metal Management’s shares are held by insiders, indicating less insider confidence.
Analyst recommendations also favor Select Water Solutions, which has received positive ratings. According to MarketBeat.com, the target prices and ratings for both companies reflect a more optimistic outlook for Select Water Solutions compared to its competitor.
Dividend Performance and Financial Metrics
In terms of dividends, Select Water Solutions offers an annual dividend of $0.28 per share, resulting in a dividend yield of 2.6%. Meanwhile, Sims Metal Management pays an annual dividend of $0.14 per share, yielding 1.6%. Notably, Select Water Solutions distributes 90.3% of its earnings as dividends, raising concerns about its long-term sustainability. Nevertheless, Select Water Solutions has increased its dividend for two consecutive years, highlighting its commitment to returning value to shareholders.
When comparing revenue and earnings, Select Water Solutions demonstrates higher earnings but lower overall revenue than Sims Metal Management. This distinction may play a crucial role in determining the future growth potential of both firms.
Volatility, Risk, and Profitability
Both companies exhibit similar volatility levels, with Select Water Solutions and Sims Metal Management each having a beta of 1.24. This indicates that both stocks are 24% more volatile than the S&P 500 index, which may pose risks for investors during market fluctuations.
Profitability metrics further differentiate these firms. Select Water Solutions shows promising net margins and returns on equity and assets compared to Sims Metal Management, signaling stronger operational efficiency.
In summary, Select Water Solutions outperforms Sims Metal Management across 13 of the 15 factors evaluated in this analysis. This comparative study suggests that investors may find Select Water Solutions to be a more attractive option in the current market landscape.
About the Companies
Select Water Solutions, Inc., headquartered in Houston, Texas, provides water management and chemical solutions primarily for the energy industry. The company operates through three segments: Water Services, Water Infrastructure, and Chemical Technologies. These segments encompass a range of services, including water sourcing, transfer, monitoring, and various chemical applications for the oil and gas sector. Select Water Solutions was previously known as Select Energy Services, Inc. and rebranded in May 2023.
On the other hand, Sims Metal Management, founded in 1917 and based in Mascot, Australia, focuses on the processing and selling of ferrous and non-ferrous recycled metals. The company operates through multiple segments, including North America Metals and Global Trading, and is involved in the recycling of electronic products and municipal materials.
This analysis emphasizes the distinct characteristics and performance metrics of Select Water Solutions and Sims Metal Management, providing valuable insights for potential investors.
