Head to Head Analysis: Flowserve Corporation (FLS) & Ampco-Pittsburgh Corporation (NYSE:AP)

Flowserve Corporation (NYSE: FLS) and Ampco-Pittsburgh Corporation (NYSE:AP) are both industrial products companies, but which is the superior business? We will contrast the two companies based on the strength of their profitability, institutional ownership, dividends, valuation, analyst recommendations, earnings and risk.

Earnings and Valuation

This table compares Flowserve Corporation and Ampco-Pittsburgh Corporation’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Flowserve Corporation $3.76 billion 1.35 $426.15 million $0.77 50.43
Ampco-Pittsburgh Corporation $389.05 million 0.43 $8.08 million ($5.94) -2.28

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

Insider and Institutional Ownership

56.5% of Ampco-Pittsburgh Corporation shares are held by institutional investors. 1.0% of Flowserve Corporation shares are held by insiders. Comparatively, 29.9% of Ampco-Pittsburgh Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and target prices for Flowserve Corporation and Ampco-Pittsburgh Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Flowserve Corporation 1 7 6 0 2.36
Ampco-Pittsburgh Corporation 0 0 1 0 3.00

Flowserve Corporation presently has a consensus price target of $48.89, suggesting a potential upside of 25.90%. Ampco-Pittsburgh Corporation has a consensus price target of $22.00, suggesting a potential upside of 62.36%. Given Ampco-Pittsburgh Corporation’s stronger consensus rating and higher possible upside, analysts clearly believe Ampco-Pittsburgh Corporation is more favorable than Flowserve Corporation.

Dividends

Flowserve Corporation pays an annual dividend of $0.76 per share and has a dividend yield of 2.0%. Ampco-Pittsburgh Corporation pays an annual dividend of $0.36 per share and has a dividend yield of 2.7%. Flowserve Corporation pays out 98.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Ampco-Pittsburgh Corporation pays out -6.1% of its earnings in the form of a dividend. Ampco-Pittsburgh Corporation has raised its dividend for 10 consecutive years. Ampco-Pittsburgh Corporation is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Flowserve Corporation and Ampco-Pittsburgh Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Flowserve Corporation 2.68% 13.20% 4.71%
Ampco-Pittsburgh Corporation -18.73% -25.72% -7.33%

Risk and Volatility

Flowserve Corporation has a beta of 1.46, suggesting that its share price is 46% more volatile than the S&P 500. Comparatively, Ampco-Pittsburgh Corporation has a beta of 1.55, suggesting that its share price is 55% more volatile than the S&P 500.

About Flowserve Corporation

Flowserve Corporation is a manufacturer and aftermarket service provider of flow control systems. The Company’s segments include Engineered Product Division, Industrial Product Division and Flow Control Division. Its geographic segments include North America, Europe, Asia Pacific, Middle East and Africa, and Latin America. It develops and manufactures precision-engineered flow control equipment integral to the movement, control and protection of the flow of materials in its customer’s critical processes. Its product portfolio of pumps, valves, seals, automation and aftermarket services supports infrastructure industries, including oil and gas, chemical, power generation and water management. It offers aftermarket equipment services, such as installation, diagnostics, repair and retrofitting through manufacturing platform and network of Quick Response Centers. Its products include oil and gas, general industries, chemical, power generation and water management.

About Ampco-Pittsburgh Corporation

Ampco-Pittsburgh Corporation is engaged in manufacturing and selling specialty metal products and customized equipment utilized by industry throughout the world. The Company operates through two segments: the Forged and Cast Engineered Products segment, and the Air and Liquid Processing segment. The Forged and Cast Engineered Products segment consists of Union Electric Steel Corporation (Union Electric Steel or UES) and Union Electric Steel UK Limited (UES-UK). The Air and Liquid Processing segment includes Aerofin, Buffalo Air Handling and Buffalo Pumps, all divisions of Air & Liquid Systems Corporation (Air and Liquid), a subsidiary of the Company. Union Electric Steel produces ingot and forged products that service a range of industries across the globe. UES-UK produces cast rolls for hot and cold strip mills, medium/heavy section mills and plate mills in a range of iron and steel qualities.

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