Houston Wire & Cable (HWCC) vs. WESCO International (WCC) Critical Analysis

Houston Wire & Cable (NASDAQ: HWCC) and WESCO International (NYSE:WCC) are both industrial products companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, risk, valuation, profitability, dividends and earnings.

Risk & Volatility

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Houston Wire & Cable has a beta of 1.4, suggesting that its stock price is 40% more volatile than the S&P 500. Comparatively, WESCO International has a beta of 1.84, suggesting that its stock price is 84% more volatile than the S&P 500.

Institutional & Insider Ownership

65.1% of Houston Wire & Cable shares are owned by institutional investors. 3.9% of Houston Wire & Cable shares are owned by company insiders. Comparatively, 1.9% of WESCO International shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Houston Wire & Cable and WESCO International, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Houston Wire & Cable 0 0 2 0 3.00
WESCO International 0 6 6 0 2.50

Houston Wire & Cable presently has a consensus price target of $8.00, indicating a potential upside of 1.91%. WESCO International has a consensus price target of $68.75, indicating a potential upside of 10.18%. Given WESCO International’s higher possible upside, analysts clearly believe WESCO International is more favorable than Houston Wire & Cable.

Profitability

This table compares Houston Wire & Cable and WESCO International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Houston Wire & Cable -0.07% 2.68% 1.29%
WESCO International 2.13% 9.06% 4.07%

Earnings & Valuation

This table compares Houston Wire & Cable and WESCO International’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Houston Wire & Cable $317.70 million 0.41 -$220,000.00 $0.15 52.33
WESCO International $7.68 billion 0.38 $163.46 million $3.93 15.88

WESCO International has higher revenue and earnings than Houston Wire & Cable. WESCO International is trading at a lower price-to-earnings ratio than Houston Wire & Cable, indicating that it is currently the more affordable of the two stocks.

Summary

WESCO International beats Houston Wire & Cable on 9 of the 14 factors compared between the two stocks.

About Houston Wire & Cable

Houston Wire & Cable Company is a holding company. The Company is engaged in provision of electrical and mechanical wire and cable, hardware and related services. It operates through sales of wire and cable, hardware and related services segment in the United States market. Its cable management program includes purchasing and storing inventory for product availability. The Company offers products in categories of wire and cable, including continuous and interlocked armor cable; control and power cable; electronic wire and cable; flexible and portable cord; instrumentation and thermocouple cable; lead and high temperature cable; medium voltage cable; premise and category wire and cable; primary and secondary aluminum distribution cable, and synthetic fiber rope slings, chain, shackles, and other related hardware. The Company also offers private branded products, including its brand LifeGuard, a low smoke zero halogen (LSZH) cable. Its products are used in repair and replacement work.

About WESCO International

WESCO International, Inc. distributes electrical, industrial, and communications maintenance, repair and operating (MRO) and original equipment manufacturers products and construction materials in North America and internationally. The company sells general supplies, such as wiring devices, fuses, terminals, connectors, boxes, enclosures, fittings, lugs, terminations, wraps, splicing and marking equipment, tools and testers, safety, personal protection, sealants, cutting tools, adhesives, consumables, fasteners, janitorial, and other MRO supplies. It also distributes wires, cables, raceways, and metallic and non-metallic conduits; and communications and security products, including structured cabling systems, broadband products, low voltage specialty systems, specialty wire and cable products, equipment racks and cabinets, access controls, alarms, cameras, and paging and voice solutions. In addition, the company sells electrical distribution and controls comprising circuit breakers, transformers, switchboards, panel boards, metering products, and busway products; lamps, fixtures, ballasts, and lighting control products; and motor control devices, drives, relays, timers, pushbuttons, operator interfaces, switches, sensors, interconnects, and surge and power protection products. Further, it provides supply chain management and logistics services; and value-added services in the areas of construction, e-commerce, energy and sustainability, engineering, production support, safety and security, supply chain optimization, training, and working capital. The company serves industrial firms, electrical and data communications contractors, utilities, commercial organizations, institutions, and governmental entities. WESCO International, Inc. was founded in 1922 and is headquartered in Pittsburgh, Pennsylvania.

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