Nexans (OTCMKTS:NXPRF) versus Eaton (NYSE:ETN) Critical Comparison

Nexans (OTCMKTS:NXPRF) and Eaton (NYSE:ETN) are both industrials companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, valuation, profitability, dividends, earnings, institutional ownership and risk.

Institutional and Insider Ownership

37.0% of Nexans shares are owned by institutional investors. Comparatively, 83.0% of Eaton shares are owned by institutional investors. 0.1% of Eaton shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Nexans and Eaton’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nexans	N/A	N/A	N/A
Eaton	12.75%	24.58%	9.98%

Analyst Recommendations

This is a breakdown of current ratings for Nexans and Eaton, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nexans	0	0	3	0	3.00
Eaton	0	4	13	2	2.89

Eaton has a consensus target price of $440.89, indicating a potential upside of 5.97%. Given Eaton’s higher probable upside, analysts plainly believe Eaton is more favorable than Nexans.

Valuation & Earnings

This table compares Nexans and Eaton”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nexans	N/A	N/A	N/A	($4.34)	-34.42
Eaton	$27.45 billion	5.89	$4.09 billion	$9.83	42.32

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

Summary

Eaton beats Nexans on 11 of the 12 factors compared between the two stocks.

About Nexans

Nexans S.A. manufactures and sells cables in France, Canada, Norway, Germany, and internationally. It operates through Building & Territories, Generation & Transmission, Industry & Solutions, and Other Activities segments. The company offers cables for the energy distribution networks, as well as equipment cables for buildings. It also provides design, engineering, financing, asset management, and systems management solutions for offshore wind farms, subsea interconnections, onshore high voltage, and subsea data transmissions; and smart solutions for oil and gas sector. In addition, the company offers cabling and connectivity solutions to support OEMs and industrial infrastructure project managers in transport, automatic devices, renewable energy, resources, and other markets. Further, it provides wire rods and electrical wires; and engages in winding wire production operations. The company was incorporated in 1994 and is headquartered in Courbevoie, France.

About Eaton

Eaton Corporation plc operates as a power management company worldwide. The company’s Electrical Americas and Electrical Global segment provides electrical components, industrial components, power distribution and assemblies, residential products, single and three phase power quality and connectivity products, wiring devices, circuit protection products, utility power distribution products, power reliability equipment, and services, as well as hazardous duty electrical equipment, emergency lighting, fire detection, explosion-proof instrumentation, and structural support systems. Its Aerospace segment offers pumps, motors, hydraulic power units, hoses and fittings, and electro-hydraulic pumps; valves, cylinders, electronic controls, electromechanical actuators, sensors, aircraft flap and slat systems, and nose wheel steering systems; hose, thermoplastic tubing products, fittings, adapters, couplings, and sealing and ducting products; air-to-air refueling systems, fuel pumps, fuel inerting products, sensors, and adapters and regulators; oxygen generation system, payload carriages, and thermal management products; and wiring connectors and cables, as well as hydraulic and bag filters, strainers and cartridges, and golf grips for manufacturers of commercial and military aircraft, and related after-market customers, as well as industrial applications. The company’s Vehicle segment offers transmissions, clutches, hybrid power systems, superchargers, engine valves and valve actuation systems, locking and limited slip differentials, transmission controls, and fuel vapor components for the vehicle industry. Its eMobility segment provides voltage inverters, converters, fuses, circuit protection units, vehicle controls, power distribution systems, fuel tank isolation valves, and commercial vehicle hybrid systems. Eaton Corporation plc was founded in 1911 and is based in Dublin, Ireland.