Analyzing DNOW (NYSE:DNOW) and SiteOne Landscape Supply (NYSE:SITE)

DNOW (NYSE:DNOW) and SiteOne Landscape Supply (NYSE:SITE) are both mid-cap industrials companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, dividends, valuation, institutional ownership, profitability and analyst recommendations.

Analyst Ratings

This is a summary of current ratings and target prices for DNOW and SiteOne Landscape Supply, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DNOW	0	3	3	1	2.71
SiteOne Landscape Supply	0	8	5	0	2.38

DNOW currently has a consensus price target of $18.20, suggesting a potential upside of 10.34%. SiteOne Landscape Supply has a consensus price target of $121.80, suggesting a potential upside of 17.05%. Given SiteOne Landscape Supply’s higher probable upside, analysts plainly believe SiteOne Landscape Supply is more favorable than DNOW.

Insider and Institutional Ownership

97.6% of DNOW shares are held by institutional investors. 1.9% of DNOW shares are held by insiders. Comparatively, 2.1% of SiteOne Landscape Supply shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Volatility & Risk

DNOW has a beta of 0.89, indicating that its share price is 11% less volatile than the S&P 500. Comparatively, SiteOne Landscape Supply has a beta of 1.38, indicating that its share price is 38% more volatile than the S&P 500.

Profitability

This table compares DNOW and SiteOne Landscape Supply’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DNOW	-4.58%	3.91%	2.25%
SiteOne Landscape Supply	3.41%	9.76%	4.83%

Earnings and Valuation

This table compares DNOW and SiteOne Landscape Supply”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DNOW	$2.82 billion	1.06	-$89.00 million	($1.07)	-15.42
SiteOne Landscape Supply	$4.70 billion	0.97	$155.40 million	$3.65	28.51

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

Summary

SiteOne Landscape Supply beats DNOW on 11 of the 15 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 SiteOne Landscape Supply

SiteOne Landscape Supply, Inc., together with its subsidiaries, engages in the wholesale distribution of landscape supplies in the United States and Canada. The company provides irrigation products, including controllers, valves, sprinkler heads, irrigation pipes, micro irrigation, and drip products; fertilizer, grass seed, and ice melt products; control products, such as herbicides, fungicides, rodenticides, and other pesticides; landscape accessories that include mulches, soil amendments, drainage pipes, tools, and sods; nursery goods, which consist of deciduous and evergreen shrubs, ornamental, shade, evergreen trees, field grown and container-grown nursery stock, roses, perennials, annuals, bulbs, and plant species and cultivars; hardscapes, such as pavers, natural stones, blocks, and other durable materials; and outdoor lighting products that include lighting fixtures, LED lamps, wires, transformers, and accessories. It also offers consultative services consisting of assistance with irrigation project take-offs, commercial project planning, generation of sales leads, business operations, and product support services, as well as a series of technical and business management seminars; and distributes branded products of third parties. The company offers its products under the LESCO, SiteOne Green Tech, and Pro-Trade brand names. It markets its products primarily to residential and commercial landscape professionals who specializes in the design, installation, and maintenance of lawns, gardens, golf courses, and other outdoor spaces through branch network and direct distribution. SiteOne Landscape Supply, Inc. was incorporated in 2013 and is headquartered in Roswell, Georgia.