Xylem (NYSE:XYL) vs. Quest Resource (NASDAQ:QRHC) Critical Comparison

Xylem (NYSE:XYL) and Quest Resource (NASDAQ:QRHC) are both business services companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, risk, profitability, institutional ownership, analyst recommendations, earnings and valuation.

Risk & Volatility

Xylem has a beta of 1.13, suggesting that its share price is 13% more volatile than the S&P 500. Comparatively, Quest Resource has a beta of 0.25, suggesting that its share price is 75% less volatile than the S&P 500.

Earnings and Valuation

This table compares Xylem and Quest Resource”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Xylem	$8.56 billion	4.22	$890.00 million	$3.85	38.52
Quest Resource	$288.53 million	0.10	-$15.06 million	($1.21)	-1.13

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

Profitability

This table compares Xylem and Quest Resource’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Xylem	10.74%	10.33%	6.72%
Quest Resource	-9.34%	-13.12%	-3.98%

Institutional and Insider Ownership

88.0% of Xylem shares are held by institutional investors. Comparatively, 48.2% of Quest Resource shares are held by institutional investors. 0.3% of Xylem shares are held by insiders. Comparatively, 22.9% of Quest Resource shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Xylem and Quest Resource, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Xylem	0	5	8	1	2.71
Quest Resource	1	3	0	0	1.75

Xylem presently has a consensus price target of $154.67, suggesting a potential upside of 4.28%. Quest Resource has a consensus price target of $2.25, suggesting a potential upside of 64.23%. Given Quest Resource’s higher probable upside, analysts clearly believe Quest Resource is more favorable than Xylem.

Summary

Xylem beats Quest Resource on 13 of the 15 factors compared between the two stocks.

About Xylem

Xylem Inc., together with its subsidiaries, engages in the design, manufacture, and servicing of engineered products and solutions worldwide. It operates through four segments: Water Infrastructure, Applied Water, Measurement & Control Solutions, and Integrated Solutions and Services. The Water Infrastructure segment offers products, including water, storm water, and wastewater pumps; controls and systems; filtration, disinfection, and biological treatment equipment; and mobile dewatering equipment and rental services under the ADI, Flygt, Godwin, Sanitaire, Magneto, Neptune Benson, Ionpure, Leopold, Wedeco, and Xylem Vue brands. The Applied Water segment provides pumps, valves, heat exchangers, controls, and dispensing equipment systems under the Goulds Water Technology, Bell & Gossett, A-C Fire Pump, Standard Xchange, Lowara, Jabsco, Xylem Vue, and Flojet brands. The Measurement & Control Solutions segment offers smart meters, networked communication devices, data analytics, test equipment, controls, sensor devices, software and managed services, and critical infrastructure services; and software and services, including cloud-based analytics, remote monitoring and data management, leak detection, condition assessment, asset management, and pressure monitoring solutions, as well as testing equipment. This segment sells its products under the Pure Technologies, Sensus, Smith Blair, WTW, Xylem Vue, and YSI brands. The Integrated Solutions and Services segment provides maintenance services, mobile services, digital outsourced solutions, wastewater systems, environmental remediation, odor and corrosion control, filtration, reverse osmosis, ion exchange, and deionization under Aquapro, WaterOne, and Ion Pure brands. Xylem Inc. was formerly known as ITT WCO, Inc. and changed its name to Xylem Inc. in May 2011. Xylem Inc. was incorporated in 2011 and is headquartered in Washington, District of Columbia.

About Quest Resource

Quest Resource Holding Corporation, together with its subsidiaries, provides solutions for the reuse, recycling, and disposal of various waste streams and recyclables in the United States. The company provides disposal and recycling services for motor oil and automotive lubricants, oil filters, scrap tires, oily water, goods destruction, food waste, meat renderings, cooking oil and grease trap waste, plastics, cardboard, metal, glass, mixed paper, construction debris, as well as a large variety of regulated and non-regulated solid, liquid, and gas wastes. It offers antifreeze and windshield washer fluid, dumpster and compacting equipment, and other minor ancillary services. In addition, the company offers landfill diversion services. Its services focus on the waste streams and recyclables from big box, grocers, and other retailers; automotive maintenance, quick lube, dealerships, and collision repair; transportation, logistics, and internal fleet operators; manufacturing plants; multi-family and commercial properties; restaurant chains and food operations; and construction and demolition projects. The company markets its services to automotive, manufacturing, hospitality and retail, construction and demolition, and commercial and multi-family property management industries through direct sales force and strategic partnerships. The company was formerly known as Infinity Resources Holdings Corp. and changed its name to Quest Resource Holding Corporation in October 2013. Quest Resource Holding Corporation is headquartered in The Colony, Texas.