Financial Comparison: KMG Chemicals (KMG) and Minerals Technologies (MTX)
Minerals Technologies (NYSE: MTX) and KMG Chemicals (NYSE:KMG) are both basic materials companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, profitability, dividends, analyst recommendations, risk, valuation and institutional ownership.
Earnings and Valuation
This table compares Minerals Technologies and KMG Chemicals’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Minerals Technologies||$1.62 billion||1.46||$349.20 million||$4.40||15.28|
|KMG Chemicals||$312.48 million||1.87||$51.47 million||$1.80||27.31|
Minerals Technologies has higher revenue and earnings than KMG Chemicals. Minerals Technologies is trading at a lower price-to-earnings ratio than KMG Chemicals, indicating that it is currently the more affordable of the two stocks.
This table compares Minerals Technologies and KMG Chemicals’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Risk and Volatility
Minerals Technologies has a beta of 2.21, meaning that its stock price is 121% more volatile than the S&P 500. Comparatively, KMG Chemicals has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500.
This is a breakdown of current ratings and recommmendations for Minerals Technologies and KMG Chemicals, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Minerals Technologies currently has a consensus target price of $80.00, indicating a potential upside of 18.96%. KMG Chemicals has a consensus target price of $37.00, indicating a potential downside of 24.74%. Given Minerals Technologies’ higher possible upside, equities analysts clearly believe Minerals Technologies is more favorable than KMG Chemicals.
Insider & Institutional Ownership
94.6% of Minerals Technologies shares are owned by institutional investors. Comparatively, 73.7% of KMG Chemicals shares are owned by institutional investors. 2.2% of Minerals Technologies shares are owned by company insiders. Comparatively, 6.9% of KMG Chemicals shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Minerals Technologies pays an annual dividend of $0.20 per share and has a dividend yield of 0.3%. KMG Chemicals pays an annual dividend of $0.12 per share and has a dividend yield of 0.2%. Minerals Technologies pays out 4.5% of its earnings in the form of a dividend. KMG Chemicals pays out 6.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Minerals Technologies is clearly the better dividend stock, given its higher yield and lower payout ratio.
Minerals Technologies beats KMG Chemicals on 9 of the 14 factors compared between the two stocks.
About Minerals Technologies
Minerals Technologies Inc. is a resource- and technology-based company that develops, produces and markets a range of specialty mineral, mineral-based and synthetic mineral products and related systems and services around the world. It operates through four segments. The Specialty Minerals segment produces and sells the synthetic mineral product precipitated calcium carbonate (PCC), mines mineral ores, and processes and sells natural mineral products, primarily limestone and talc. The Performance Materials segment is a supplier of bentonite and bentonite-related products to industrial and consumer markets globally. The Refractories segment produces and markets monolithic and shaped refractory materials and specialty products, services and application and measurement equipment. The Energy Services segment offers a range of services to improve the production, costs, compliance and environmental impact of activities performed in the oil and gas industry.
About KMG Chemicals
KMG Chemicals, Inc. manufactures, formulates and globally distributes specialty chemicals. The Company operates businesses selling electronic chemicals, industrial wood treating chemicals, and industrial valve lubricants and sealants. The Company operates through two segments: Electronic chemicals and Other chemicals. The Company operates through its subsidiaries, KMG Electronic Chemicals, Inc. (KMG EC), KMG-Bernuth, Inc. (KMG Bernuth) and KMG Val-Tex, LLC (Val-Tex). The Company’s Electronic chemicals business sells high purity and ultra-purity wet process chemicals primarily to the semiconductor industry. The Company’s Other chemicals segment includes its industrial lubricants business and wood treating chemicals business. The Company’s products sulfuric, phosphoric, nitric and hydrofluoric acids, ammonium hydroxide, hydrogen peroxide, isopropyl alcohol, other specialty organic solvents and various blends of chemicals.
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