Sigma-Aldrich (NASDAQ: SIAL) and Versum Materials (NYSE:VSM) are both basic materials companies, but which is the better business? We will compare the two companies based on the strength of their dividends, valuation, earnings, analyst recommendations, profitabiliy, institutional ownership and risk.

Profitability

This table compares Sigma-Aldrich and Versum Materials’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Sigma-Aldrich 16.22% 13.72% 10.47%
Versum Materials N/A N/A N/A

Valuation & Earnings

This table compares Sigma-Aldrich and Versum Materials’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Sigma-Aldrich N/A N/A N/A N/A N/A
Versum Materials $1.03 billion 3.73 $338.40 million N/A N/A

Versum Materials has higher revenue and earnings than Sigma-Aldrich.

Institutional & Insider Ownership

88.3% of Versum Materials shares are owned by institutional investors. 0.5% of Versum Materials shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Dividends

Versum Materials pays an annual dividend of $0.20 per share and has a dividend yield of 0.6%. Sigma-Aldrich does not pay a dividend. Sigma-Aldrich has increased its dividend for 41 consecutive years.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Sigma-Aldrich and Versum Materials, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sigma-Aldrich 0 0 0 0 N/A
Versum Materials 0 4 6 0 2.60

Versum Materials has a consensus price target of $32.44, suggesting a potential downside of 8.22%. Given Versum Materials’ higher possible upside, analysts plainly believe Versum Materials is more favorable than Sigma-Aldrich.

Summary

Versum Materials beats Sigma-Aldrich on 6 of the 10 factors compared between the two stocks.

Sigma-Aldrich Company Profile

Sigma-Aldrich Corporation is a life science and high technology company. The Company develops, manufactures, purchases and distributes a range of biochemical and organic chemical products, kits and services that are used in scientific research. It manufactures and distributes around 250,000 chemicals, biochemical and other essential products and approximately 46,000 equipment products. Its business unit structure is aligned into three business units: Research, Applied and SAFC Commercial. Its brands include Sigma-Aldrich, Sigma, Aldrich, Fluka, Riedel-de Haen, Supelco, SAFC, SAFC Biosciences, SAFC Hitech, Genosys, Proligo, Pharmorphix, Cerilliant, Vetec, BioReliance and Cell Marque. It offers its products and services to research and applied labs, pharmaceutical companies, universities, commercial laboratories, industrial companies, biotechnology companies and non-profit organizations, among others. It operates in around 37 countries and sells into approximately 160 countries.

Versum Materials Company Profile

Versum Materials, Inc. is a provider of solutions to the semiconductor and display industries. The Company is engaged in the development, manufacturing, transportation and handling of specialty materials. Its segments include Materials; Delivery Systems and Services (DS&S), and Corporate. The Materials segment is an integrated provider of specialty materials for the electronics industry, focusing on the integrated circuit and flat-panel display markets. The DS&S segment designs, manufactures, installs, operates, and maintains chemical and gas delivery and distribution systems for specialty gases and chemicals delivered directly to its customers’ manufacturing tools. The Company is engaged in molecular design and synthesis, purification, advanced analytics, formulation development and containers and delivery systems for the handling of high purity materials.

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