Financial Analysis: NL Industries (NYSE:NL) vs. Wrap Technologies (OTCMKTS:WRTC)

NL Industries (NYSE:NL) and Wrap Technologies (OTCMKTS:WRTC) are both small-cap industrials companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, profitability, earnings, analyst recommendations, risk and institutional ownership.

Valuation and Earnings

This table compares NL Industries and Wrap Technologies’ gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NL Industries	$161.30 million	1.98	-$2.31 million	($0.04)	-163.46
Wrap Technologies	N/A	N/A	N/A	($0.37)	-7.68

Wrap Technologies has lower revenue, but higher earnings than NL Industries. NL Industries is trading at a lower price-to-earnings ratio than Wrap Technologies, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

11.0% of NL Industries shares are held by institutional investors. Comparatively, 15.6% of Wrap Technologies shares are held by institutional investors. 0.3% of NL Industries shares are held by company insiders. Comparatively, 54.5% of Wrap Technologies shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares NL Industries and Wrap Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NL Industries	-1.43%	-0.59%	-0.40%
Wrap Technologies	N/A	N/A	N/A

Risk and Volatility

NL Industries has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500. Comparatively, Wrap Technologies has a beta of 1.87, suggesting that its share price is 87% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for NL Industries and Wrap Technologies, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NL Industries	1	0	0	0	1.00
Wrap Technologies	0	0	0	0	N/A

NL Industries currently has a consensus price target of $5.00, suggesting a potential downside of 23.55%. Given NL Industries’ higher probable upside, analysts clearly believe NL Industries is more favorable than Wrap Technologies.

Summary

Wrap Technologies beats NL Industries on 7 of the 10 factors compared between the two stocks.

About NL Industries

NL Industries, Inc., through its subsidiary, CompX International Inc., operates in the component products industry in Europe, North America, the Asia Pacific, and internationally. The company manufactures and sells mechanical and electronic cabinet locks and other locking mechanisms, including disc tumbler locks; pin tumbler locking mechanisms under KeSet, System 64, TuBar, and Turbine brands; and electronic locks under CompX eLock and StealthLock brands for use in various applications, such as mailboxes, ignition systems, file cabinets, desk drawers, tool storage cabinets, high security medical cabinetry, integrated inventory and access control secured narcotics boxes, electronic circuit panels, storage compartments, gas station security, vending and cash containment machines. It also offers original equipment and aftermarket stainless steel exhaust headers, exhaust pipes, mufflers, and other exhaust components; gauges, such as GPS speedometers and tachometers; mechanical and electronic controls and throttles; wake enhancement devices, trim tabs, steering wheels, and other billet aluminum accessories; dash panels, LED indicators, wire harnesses, and other accessories; and grab handles, pin cleats, and other accessories; primarily for performance and ski/wakeboard and performance boats. In addition, the company produces and markets value-added titanium dioxide pigments, a base industrial product used in imparting whiteness, brightness, opacity, and durability to a diverse range of customer applications and end-use markets, including coatings, plastics, paper, inks, cosmetics, pharmaceuticals, and other industrial and consumer products. The company sells its component products directly to original equipment manufacturers, as well as through distributors. NL Industries, Inc. was founded in 1891 and is based in Dallas, Texas. NL Industries, Inc. operates as a subsidiary of Valhi, Inc.

About Wrap Technologies

Wrap Technologies, Inc operates as a development stage security technology company. It focuses on delivering solutions to customers, primarily law enforcement and security personnel. The firm products includes BolaWrap 100, which is a hand-held remote restraint device that discharges an eight-foot bola style Kevlar tether to entangle an individual at a range of 10-25 feet. The company was founded by Elwood G. Norris, Scot J. Cohen and James A. Barnes on March 2, 2016 and is headquartered in Las Vegas, NV.