Contrasting LSB Industries (LXU) and Praxair (PX)

LSB Industries (NYSE: LXU) and Praxair (NYSE:PX) are both multi-sector conglomerates companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, institutional ownership, dividends, analyst recommendations, profitability, risk and earnings.

Earnings & Valuation

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This table compares LSB Industries and Praxair’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
LSB Industries $427.50 million 0.40 -$29.21 million N/A N/A
Praxair $11.44 billion 3.78 $1.25 billion $5.85 25.76

Praxair has higher revenue and earnings than LSB Industries.

Analyst Ratings

This is a summary of recent ratings and target prices for LSB Industries and Praxair, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
LSB Industries 0 0 0 0 N/A
Praxair 0 6 10 0 2.63

Praxair has a consensus target price of $164.36, suggesting a potential upside of 9.08%. Given Praxair’s higher possible upside, analysts clearly believe Praxair is more favorable than LSB Industries.

Dividends

Praxair pays an annual dividend of $3.30 per share and has a dividend yield of 2.2%. LSB Industries does not pay a dividend. Praxair pays out 56.4% of its earnings in the form of a dividend. Praxair has raised its dividend for 13 consecutive years.

Insider and Institutional Ownership

61.4% of LSB Industries shares are owned by institutional investors. Comparatively, 86.3% of Praxair shares are owned by institutional investors. 18.2% of LSB Industries shares are owned by insiders. Comparatively, 0.2% of Praxair shares are owned by 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.

Risk & Volatility

LSB Industries has a beta of 4.4, indicating that its share price is 340% more volatile than the S&P 500. Comparatively, Praxair has a beta of 1.08, indicating that its share price is 8% more volatile than the S&P 500.

Profitability

This table compares LSB Industries and Praxair’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
LSB Industries -6.83% -6.65% -2.49%
Praxair 10.90% 26.54% 8.40%

Summary

Praxair beats LSB Industries on 11 of the 14 factors compared between the two stocks.

About LSB Industries

LSB Industries, Inc. is a holding company. The Company, through its subsidiaries, is engaged in the manufacture and sale of chemical products. The Company operates through chemical business segment. It is a manufacturer and distributor of nitrogen fertilizer and other nitrogen products in North America. Its principal nitrogen products are ammonia (AN), fertilizer grade ammonium nitrate (high density ammonium nitrate prills used in the agricultural industry (HDAN)), urea ammonia nitrate (UAN), and AN solution for agricultural applications, high purity and commercial grade ammonia, high purity AN, sulfuric acids, concentrated, blended and regular nitric acid, mixed nitrating acids, carbon dioxide, and diesel exhaust fluid for industrial applications, and industrial grade AN (low density ammonium nitrate prills used in the mining industry (LDAN)) and 83% AN solution (AN solution) for the mining industry. Its customers include cooperatives and independent fertilizer distributors.

About Praxair

Praxair, Inc. produces and distributes industrial gases. It operates through five segments: North America, Europe, South America, Asia, and Surface Technologies. The company offers atmospheric gases, including oxygen, nitrogen, argon, and rare gases; and process gases, such as carbon dioxide, helium, hydrogen, electronic gases, specialty gases, and acetylene. It also supplies wear-resistant and high-temperature corrosion-resistant metallic and ceramic coatings and powders to the aircraft, energy, printing, primary metals, petrochemical, textile, and other industries. In addition, the company offers electric arc, plasma and wire spray, and high-velocity oxy-fuel equipment; and distributes hardgoods and welding equipment purchased from independent manufacturers. It serves various industries, such as healthcare, petroleum refining, manufacturing, food, beverage carbonation, fiber-optics, steel making, aerospace, chemicals, and water treatment. Praxair, Inc. was founded in 1907 and is headquartered in Danbury, Connecticut.

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