Pentair (NYSE:PNR) and Select Water Solutions (NYSE:WTTR) Financial Analysis

Pentair (NYSE:PNR) and Select Water Solutions (NYSE:WTTR) are both business services companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, profitability, risk, institutional ownership and earnings.

Insider & Institutional Ownership

92.4% of Pentair shares are owned by institutional investors. Comparatively, 81.7% of Select Water Solutions shares are owned by institutional investors. 1.5% of Pentair shares are owned by insiders. Comparatively, 8.4% of Select Water Solutions shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

Pentair pays an annual dividend of $1.08 per share and has a dividend yield of 1.1%. Select Water Solutions pays an annual dividend of $0.28 per share and has a dividend yield of 2.1%. Pentair pays out 27.3% of its earnings in the form of a dividend. Select Water Solutions pays out 133.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Pentair has raised its dividend for 7 consecutive years and Select Water Solutions has raised its dividend for 2 consecutive years.

Analyst Ratings

This is a summary of current recommendations and price targets for Pentair and Select Water Solutions, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Pentair	3	3	10	0	2.44
Select Water Solutions	0	1	3	1	3.00

Pentair currently has a consensus target price of $114.47, suggesting a potential upside of 16.53%. Select Water Solutions has a consensus target price of $16.63, suggesting a potential upside of 21.88%. Given Select Water Solutions’ stronger consensus rating and higher probable upside, analysts plainly believe Select Water Solutions is more favorable than Pentair.

Risk and Volatility

Pentair has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500. Comparatively, Select Water Solutions has a beta of 1.03, meaning that its share price is 3% more volatile than the S&P 500.

Profitability

This table compares Pentair and Select Water Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Pentair	15.66%	21.79%	12.14%
Select Water Solutions	1.51%	2.30%	1.35%

Earnings and Valuation

This table compares Pentair and Select Water Solutions”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Pentair	$4.18 billion	3.84	$653.80 million	$3.96	24.81
Select Water Solutions	$1.41 billion	1.17	$21.22 million	$0.21	64.95

Pentair has higher revenue and earnings than Select Water Solutions. Pentair is trading at a lower price-to-earnings ratio than Select Water Solutions, indicating that it is currently the more affordable of the two stocks.

Summary

Pentair beats Select Water Solutions on 12 of the 18 factors compared between the two stocks.

About Pentair

Pentair plc provides various water solutions in the United States, Western Europe, China, Eastern Europe, Latin America, the Middle East, Southeast Asia, Australia, Canada, and Japan. The company operates through three segments: Flow, Water Solutions, and Pool. The Flow segment designs, manufactures, and sells fluid treatment and pump products and systems, including pressure vessels, gas recovery solutions, membrane bioreactors, wastewater reuse systems and advanced membrane filtration, separation systems, water disposal pumps, water supply pumps, fluid transfer pumps, turbine pumps, solid handling pumps, and agricultural spray nozzles for fluid delivery, ion exchange, desalination, food and beverage, separation technologies in the oil and gas industry, residential and municipal wells, water treatment, wastewater solids handling, pressure boosting, circulation and transfer, fire suppression, flood control, agricultural irrigation, and crop spray in residential, commercial, and industrial markets. The Water Solutions segment provides commercial and residential water treatment products and systems, including pressure tanks, control valves, activated carbon products, commercial ice machines, conventional filtration products, and point-of-entry and point-of-use water treatment systems, as well as installation and preventative services for use in residential whole home water filtration, drinking water filtration, and water softening solutions, as well as commercial total water management and filtration in foodservice operations. The Pool segment provides residential and commercial pool equipment and accessories comprising pumps, filters, heaters, lights, automatic controls, automatic cleaners, maintenance equipment, and pool accessories for applications in residential and commercial pool maintenance, pool repair, renovation, service, and construction and aquaculture solutions. Pentair plc was founded in 1966 and is headquartered in London, the United Kingdom.

About Select Water Solutions

Select Water Solutions, Inc., together with its subsidiaries, provides water management and chemical solutions to the energy industry in the United States. The company operates through three segments: Water Services, Water Infrastructure, and Chemical Technologies. The Water Services segment provides water-related services, including water sourcing, water transfer, flowback and well testing, water containment, fluids hauling, water monitoring, and water network automation; technology solutions comprising hydrographic mapping, water volume and quality monitoring, remote pit and tank monitoring, leak detection, asset and fuel tracking, and automated-equipment services, as well as various surface rental equipment and workforce accommodation services. The Water Infrastructure segment engages in the recycling, gathering, transferring, and disposal of water through a network of permanent pipeline infrastructure, semi-permanent pipeline infrastructure, water recycling facilities, earthen pits, water sources, and SWDs; provides solids management services; and develops, builds, and operates semi-permanent and permanent infrastructure solutions. The Chemical Technologies segment provides technical solutions, products, and services related to chemical applications in the oil and gas industry. This segment develops, manufactures, and manages logistics; and provides chemicals used in hydraulic fracturing, stimulation, cementing, and well completions for pressure pumpers and oil and gas producers, as well as offers production chemical solutions for underperforming wells, corrosion and scale monitoring, chemical inventory management, well failure analysis, and lab services. It primarily serves oil and gas producers. The company was formerly known as Select Energy Services, Inc. and changed its name to Select Water Solutions, Inc. in May 2023. Select Water Solutions, Inc. was incorporated in 2016 and is headquartered in Houston, Texas.