IDEX (NYSE:IEX – Get Free Report) and WEG (OTCMKTS:WEGZY – Get Free Report) are both large-cap industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, profitability, dividends, institutional ownership, valuation, analyst recommendations and risk.
Institutional and Insider Ownership
98.0% of IDEX shares are owned by institutional investors. 0.5% of IDEX shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Profitability
This table compares IDEX and WEG’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| IDEX | 14.65% | 16.18% | 9.42% |
| WEG | 15.39% | 32.99% | 14.37% |
Dividends
IDEX pays an annual dividend of $2.92 per share and has a dividend yield of 1.2%. WEG pays an annual dividend of $0.05 per share and has a dividend yield of 0.6%. IDEX pays out 40.6% of its earnings in the form of a dividend. WEG 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. IDEX has raised its dividend for 16 consecutive years. IDEX is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Earnings & Valuation
This table compares IDEX and WEG”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| IDEX | $3.46 billion | 5.04 | $483.20 million | $7.20 | 32.83 |
| WEG | $7.31 billion | 5.16 | $1.14 billion | $0.29 | 31.00 |
WEG has higher revenue and earnings than IDEX. WEG is trading at a lower price-to-earnings ratio than IDEX, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of recent ratings and recommmendations for IDEX and WEG, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| IDEX | 0 | 3 | 9 | 0 | 2.75 |
| WEG | 0 | 1 | 2 | 0 | 2.67 |
IDEX currently has a consensus target price of $263.64, suggesting a potential upside of 11.54%. Given IDEX’s stronger consensus rating and higher probable upside, analysts clearly believe IDEX is more favorable than WEG.
Summary
IDEX beats WEG on 9 of the 16 factors compared between the two stocks.
About IDEX
IDEX Corporation, together with its subsidiaries, provides applied solutions worldwide. The company operates through three segments: Fluid & Metering Technologies (FMT), Health & Science Technologies (HST), and Fire & Safety/Diversified Products (FSDP). The FMT segment designs, produces, and distributes positive displacement pumps, valves, small volume provers, flow meters, injectors, and other fluid-handling pump modules and systems, as well as flow monitoring and other services for the food, chemical, general industrial, water and wastewater, agricultural, and energy industries. The HST segment designs, produces, and distributes precision fluidics positive displacement pumps, powder and liquid processing technologies, drying systems, micro-precision components, pneumatic components and sealing solutions, high performance molded and extruded sealing components, custom mechanical and shaft seals, engineered hygienic mixers and valves, biocompatible medical devices and implantables, air compressors and blowers, optical components and coatings, laboratory and commercial equipment, and precision photonic solutions. This segment serves food and beverage, life sciences, analytical instruments, pharmaceutical and biopharmaceutical, industrial, semiconductor, automotive/transportation, medical/dental, energy, cosmetics, marine, chemical, wastewater and water treatment, research and aerospace/defense markets. The FSDP segment designs, produces, and distributes firefighting pumps, valves and controls, rescue tools, lifting bags, and other components and systems for the fire and rescue industry; engineered stainless steel banding and clamping devices for various industrial and commercial applications; and precision equipment for dispensing, metering, and mixing colorants and paints used in retail and commercial businesses. IDEX Corporation was incorporated in 1987 and is headquartered in Northbrook, Illinois.
About WEG
WEG S.A. engages in the production and sale of capital goods in Brazil and internationally. The company offers electric motors, generators, and transformers; gear units and geared motors; hydraulic and steam turbines; frequency converters; motor starters and maneuver devices; control and protection of electric circuits for industrial automation; power sockets and switches; and electric traction solutions for heavy vehicles, SUV vehicles, locomotives, and sea transportation capital goods. It also provides solutions for the generation of renewable and distributed energy through hydro, thermal, biomass, wind, and solar energy power plants; solutions for industry; UPSs and alternators for groups of generators; conventional and movable electric substations; industrial electrical and electronic systems; industrial paint and varnish; and paints for automotive repainting. WEG S.A. was founded in 1961 and is headquartered in Jaraguá do Sul, Brazil.
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