Kraton Corporation (KRA) vs. Valvoline (VVV) Critical Review
Kraton Corporation (NYSE: KRA) and Valvoline (NYSE:VVV) are both basic materials companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, institutional ownership, valuation, risk, analyst recommendations, earnings and profitability.
Insider & Institutional Ownership
97.5% of Kraton Corporation shares are held by institutional investors. Comparatively, 41.0% of Valvoline shares are held by institutional investors. 5.0% of Kraton Corporation shares are held by company insiders. Comparatively, 0.1% of Valvoline shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
This is a summary of recent ratings for Kraton Corporation and Valvoline, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Valvoline has a consensus price target of $25.73, indicating a potential upside of 16.84%. Given Valvoline’s higher probable upside, analysts plainly believe Valvoline is more favorable than Kraton Corporation.
This table compares Kraton Corporation and Valvoline’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Earnings and Valuation
This table compares Kraton Corporation and Valvoline’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Kraton Corporation||$1.85 billion||0.58||$338.62 million||$1.38||24.75|
|Valvoline||$2.03 billion||2.20||$520.00 million||$1.29||17.07|
Valvoline has higher revenue and earnings than Kraton Corporation. Valvoline is trading at a lower price-to-earnings ratio than Kraton Corporation, indicating that it is currently the more affordable of the two stocks.
Valvoline pays an annual dividend of $0.20 per share and has a dividend yield of 0.9%. Kraton Corporation does not pay a dividend. Valvoline pays out 15.5% of its earnings in the form of a dividend.
Valvoline beats Kraton Corporation on 8 of the 14 factors compared between the two stocks.
About Kraton Corporation
Kraton Corporation, formerly Kraton Performance Polymers, Inc., is a specialty chemicals company. The Company manufactures styrenic block copolymers (SBCs) and other engineered polymers. The Company also produces specialty products primarily derived from pine wood pulping co-products. The Company operates through two segments: Polymer Segment, which comprises SBCs and other engineered polymers business, and Chemical Segment, which comprises pine-based specialty products business. Its SBCs are used in a range of applications, including adhesives, coatings, consumer and personal care products, sealants, lubricants, medical, packaging, automotive, paving, roofing and footwear products. The Company also sells isoprene rubber (IR) and isoprene rubber latex (IRL), which are non-SBC products primarily used in applications, such as medical products, personal care, adhesives, tackifiers, paints and coatings. It offers crude tall oil (CTO) and crude sulfate turpentine (CST).
Valvoline Inc. (Valvoline) is engaged in the production and distribution of automotive, commercial and industrial lubricants, and automotive chemicals. The Company operates through three segments: Core North America, Quick Lubes and International. The Core North America segment sells Valvoline, and other branded and private label products in the United States and Canada to both consumers performing their own automotive maintenance, referred to as Do-It-Yourself (DIY) consumers, as well as, to installer customers using Valvoline products to service vehicles owned by Do-It-For-Me (DIFM) consumers. Its Quick Lubes segment services the passenger car and light truck quick lube market through platforms, including its franchised Valvoline Instant Oil Change (VIOC) stores and Express Care. Its International segment sells Valvoline and other branded products through its affiliates, joint ventures, licensees and independent distributors. Its products include All Climate, DuraBlend and MaxLife.
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