ESAB (NYSE:ESAB) & ITT (NYSE:ITT) Head to Head Review

ITT (NYSE:ITT) and ESAB (NYSE:ESAB) are both industrials companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, valuation, analyst recommendations, earnings, institutional ownership, risk and dividends.

Analyst Ratings

This is a summary of current ratings and target prices for ITT and ESAB, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ITT	0	1	8	0	2.89
ESAB	0	1	6	0	2.86

ITT currently has a consensus price target of $260.22, indicating a potential upside of 31.07%. ESAB has a consensus price target of $118.67, indicating a potential upside of 70.62%. Given ESAB’s higher probable upside, analysts plainly believe ESAB is more favorable than ITT.

Profitability

This table compares ITT and ESAB’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ITT	8.90%	15.90%	7.74%
ESAB	5.75%	14.48%	5.99%

Dividends

ITT pays an annual dividend of $1.54 per share and has a dividend yield of 0.8%. ESAB pays an annual dividend of $0.48 per share and has a dividend yield of 0.7%. ITT pays out 30.2% of its earnings in the form of a dividend. ESAB pays out 17.2% 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. ITT has increased its dividend for 10 consecutive years and ESAB has increased its dividend for 3 consecutive years. ITT is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

91.6% of ITT shares are held by institutional investors. Comparatively, 91.1% of ESAB shares are held by institutional investors. 0.9% of ITT shares are held by insiders. Comparatively, 7.2% of ESAB 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.

Valuation and Earnings

This table compares ITT and ESAB”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ITT	$3.94 billion	4.51	$488.00 million	$5.10	38.93
ESAB	$2.84 billion	1.52	$226.77 million	$2.79	24.93

ITT has higher revenue and earnings than ESAB. ESAB is trading at a lower price-to-earnings ratio than ITT, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

ITT has a beta of 1.25, suggesting that its share price is 25% more volatile than the S&P 500. Comparatively, ESAB has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500.

Summary

ITT beats ESAB on 14 of the 17 factors compared between the two stocks.

About ITT

ITT Inc., together with its subsidiaries, manufactures and sells engineered critical components and customized technology solutions for the transportation, industrial, and energy markets in the United States and internationally. The Motion Technologies segment manufactures brake pads, shims, shock absorbers, and energy absorption components; and sealing technologies primarily for the transportation industry, including passenger cars, trucks, light- and heavy-duty commercial and military vehicles, buses, and trains. This segment sells its products under ITT Friction Technologies, KONI, Wolverine Advanced Materials, Axtone, Novitek, and GALT. brand names. The Industrial Process segment provides industrial pumps, valves, and plant optimization and remote monitoring systems and services; and aftermarket solutions, such as replacement parts and services. It serves various customers in industries, such as chemical, energy, mining, and other industrial process markets. This segment sells its products under Goulds Pumps, Bornemann, Engineered Valves, PRO Services, C'treat, i-ALERT, Rheinhütte Pumpen, and Habonim brand names. The Connect & Control Technologies segment designs and manufactures a range of engineered connectors and specialized products for critical applications supporting various markets, including aerospace and defense, industrial, transportation, medical, and energy. This segment provides connector products, such as circular, rectangular, radio frequency, fiber optic, D-sub miniature, micro-miniature, and cable assemblies; and control products consist of highly engineered actuation, flow control, energy absorption, environmental control, and composite component solutions for the aerospace, defense, and industrial markets under Cannon, VEAM, BIW Connector Systems, Aerospace Controls, Enidine, Compact Automation, Neo-Dyn Process Controls, Conoflow, and Micro-Mode brand names. The company was incorporated in 1920 and is headquartered in Stamford, Connecticut.

About ESAB

ESAB Corporation engages in the formulation, development, manufacture, and supply of consumable products and equipment for use in cutting, joining, automated welding, and gas control equipment. Its comprehensive range of welding consumables includes electrodes, cored and solid wires, and fluxes using a range of specialty and other materials; and cutting consumables comprising electrodes, nozzles, shields, and tips. The company's equipment ranges from portable welding machines to large customized automated cutting and welding systems. It also offers a range of software and digital solutions to help its customers increase their productivity, remotely monitor their welding operations, and digitize their documentation. The company sells its products under the ESAB brand to various end markets, such as general industry, infrastructure, renewable energy, medical and life sciences, transportation, construction, and energy. It offers its products through independent distributors and direct salespeople. The company operates in North America, South America, Europe, the Middle East, India, Africa, and the Asia Pacific. ESAB Corporation was founded in 1904 and is headquartered in North Bethesda, Maryland.