GATX (NYSE:GATX) versus QXO (NYSE:QXO) Critical Analysis

GATX (NYSE:GATX) and QXO (NYSE:QXO) are both industrials companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, valuation, profitability, risk, dividends and earnings.

Risk & Volatility

GATX has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500. Comparatively, QXO has a beta of 2.3, suggesting that its stock price is 130% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for GATX and QXO, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GATX	0	0	4	0	3.00
QXO	1	1	15	1	2.89

GATX presently has a consensus target price of $219.33, suggesting a potential upside of 32.15%. QXO has a consensus target price of $25.21, suggesting a potential upside of 130.79%. Given QXO’s higher possible upside, analysts clearly believe QXO is more favorable than GATX.

Institutional and Insider Ownership

93.1% of GATX shares are owned by institutional investors. Comparatively, 58.7% of QXO shares are owned by institutional investors. 1.9% of GATX shares are owned by company insiders. Comparatively, 41.0% of QXO shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares GATX and QXO’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GATX	17.94%	10.43%	2.12%
QXO	-5.17%	2.41%	1.20%

Valuation and Earnings

This table compares GATX and QXO”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GATX	$1.74 billion	3.37	$333.30 million	$10.10	16.43
QXO	$6.84 billion	1.66	-$279.40 million	($0.90)	-12.14

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

Summary

GATX beats QXO on 9 of the 15 factors compared between the two stocks.

About GATX

GATX Corporation, together its subsidiaries, operates as railcar leasing company in the United States, Canada, Mexico, Europe, and India. It operates through three segments: Rail North America, Rail International, and Portfolio Management. The company leases tank and freight railcars, and locomotives for petroleum, chemical, food/agriculture, and transportation industries. It also offers maintenance services, including the interior cleaning of railcars, routine maintenance and repair of car body and safety appliances, regulatory compliance works, wheelset replacements, interior blast and lining, exterior blast and painting, and car stenciling services. In addition, the company manufactures commercial aircraft jet engines and leases aircraft spare engines; and owns and manages tank containers that are leased to chemical, industrial gas, energy, food, cryogenic and pharmaceutical industries, and tank container operators, as well as provides tank container sourcing, remarketing, and inspection and maintenance services. As of December 31, 2023, it owned and operated a fleet of approximately 148,500 railcars; 493 four-axle and 30 six-axle locomotives; 399 aircraft spare engines; and 23,931 tank containers. GATX Corporation was founded in 1898 and is headquartered in Chicago, Illinois.

About QXO

QXO, Inc. operates as a business application, technology, and consulting company in North America. The company provides solutions for accounting and business management, financial reporting, enterprise resource planning, human capital management, warehouse management systems, customer relationship management, and business intelligence. It also offers value-added services that focuses on consulting and professional, specialized programming, training, and technical support services. In addition, the company provides information technology managed services, such as cybersecurity, application hosting, disaster recovery, business continuity, cloud, and other services; and data back-up, network maintenance, and upgrade services. It serves small and medium-sized businesses primarily in the manufacturing, distribution, and service industries. QXO, Inc. is headquartered in Greenwich, Connecticut.