Critical Contrast: DNOW (NYSE:DNOW) vs. Russel Metals (OTCMKTS:RUSMF)

DNOW (NYSE:DNOW) and Russel Metals (OTCMKTS:RUSMF) are both industrials companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, valuation, profitability, risk, dividends, earnings and institutional ownership.

Institutional and Insider Ownership

97.6% of DNOW shares are owned by institutional investors. Comparatively, 42.7% of Russel Metals shares are owned by institutional investors. 2.6% of DNOW shares are owned 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.

Valuation & Earnings

This table compares DNOW and Russel Metals”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DNOW	$2.34 billion	0.53	$247.00 million	$2.17	5.37
Russel Metals	N/A	N/A	N/A	$1.73	16.61

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

Analyst Ratings

This is a summary of current ratings and price targets for DNOW and Russel Metals, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DNOW	0	1	1	0	2.50
Russel Metals	0	0	0	0	N/A

DNOW presently has a consensus target price of $15.50, indicating a potential upside of 33.05%. Given DNOW’s higher possible upside, analysts plainly believe DNOW is more favorable than Russel Metals.

Profitability

This table compares DNOW and Russel Metals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DNOW	9.70%	9.93%	6.80%
Russel Metals	N/A	N/A	N/A

Summary

DNOW beats Russel Metals on 9 of the 10 factors compared between the two stocks.

About DNOW

DNOW Inc. distributes downstream energy and industrial products for petroleum refining, chemical processing, LNG terminals, power generation utilities, and customer on-site locations in the United States, Canada, and internationally. The company provides consumable maintenance, repair, and operating supplies; pipes, manual and automated valves, fittings, flanges, gaskets, fasteners, electrical instrumentations, artificial lift, pumping solutions, valve actuation and modular process, and measurement and control equipment; and mill supplies, tools, safety supplies, and personal protective equipment, as well as artificial lift systems, coatings, and miscellaneous expendable items. It also offers original equipment manufacturer equipment, including pumps, generator sets, air compressors, dryers, blowers, mixers, and valves; modular oil and gas tank battery solutions; and application systems, work processes, parts integration, optimization solutions, and after-sales support services. In addition, the company provides supply chain and materials management; inventory planning and management, procurement, and warehouse management, as well as solutions for logistics, point of issue technology, project management, business process, and performance metrics reporting services. It serves customers in the upstream, midstream, and downstream sectors of the energy industry, including drilling contractors, well-servicing companies, independent and national oil and gas companies, midstream operators, and refineries, as well as petrochemical, chemical, utilities, RNG facilities, and other downstream energy processors; and industrial and manufacturing companies. The company was formerly known as NOW Inc. and changed its name to DNOW Inc. in January 2024. DNOW Inc. was founded in 1862 and is headquartered in Houston, Texas.

About Russel Metals

Russel Metals Inc. operates as a metal distribution and processing company in Canada and the United States. It operates in three segments: Metals Service Centers, Energy Field Stores, and Steel Distribution. The Metal Service Centers segment operates a network of metals service centers, which provide metal products in range of sizes, shapes, and specifications, including carbon hot rolled and cold finished steel, pipe and tubular, stainless steel, aluminum, and other non-ferrous specialty metal products. The Energy Field Stores segment offers specialized products, such as flanges, valves, fittings, and other products to energy industry. The Steel Distributors segment sells steel products to other steel service centers and equipment manufacturers, which include carbon steel plate, flat rolled products, beams, channels, and pipes. Russel Metals Inc. was incorporated in 1929 and is headquartered in Mississauga, Canada.