Stepan (SCL) and BioAmber (BIOA) Financial Comparison
Stepan (NYSE: SCL) and BioAmber (NYSE:BIOA) are both small-cap basic materials companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, analyst recommendations, dividends, valuation, risk, profitability and institutional ownership.
This table compares Stepan and BioAmber’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Volatility and Risk
Stepan has a beta of 1.26, meaning that its stock price is 26% more volatile than the S&P 500. Comparatively, BioAmber has a beta of 2.7, meaning that its stock price is 170% more volatile than the S&P 500.
Stepan pays an annual dividend of $0.82 per share and has a dividend yield of 1.0%. BioAmber does not pay a dividend. Stepan pays out 21.5% of its earnings in the form of a dividend. Stepan has increased its dividend for 49 consecutive years.
This is a breakdown of recent ratings and recommmendations for Stepan and BioAmber, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Stepan currently has a consensus price target of $34.25, indicating a potential downside of 58.49%. BioAmber has a consensus price target of $3.00, indicating a potential upside of 512.00%. Given BioAmber’s higher possible upside, analysts plainly believe BioAmber is more favorable than Stepan.
Insider and Institutional Ownership
62.5% of Stepan shares are held by institutional investors. Comparatively, 37.4% of BioAmber shares are held by institutional investors. 13.1% of Stepan shares are held by insiders. Comparatively, 8.3% of BioAmber shares are held by 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.
Earnings & Valuation
This table compares Stepan and BioAmber’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Stepan||$1.83 billion||1.02||$207.56 million||$3.81||21.66|
|BioAmber||$10.54 million||1.73||-$24.98 million||($0.80)||-0.61|
Stepan has higher revenue and earnings than BioAmber. BioAmber is trading at a lower price-to-earnings ratio than Stepan, indicating that it is currently the more affordable of the two stocks.
Stepan beats BioAmber on 13 of the 17 factors compared between the two stocks.
Stepan Company produces specialty and intermediate chemicals, which are sold to other manufacturers and used in a range of end products. The Company operates through three segments: Surfactants, Polymers and Specialty Products. The Company’s principal markets include manufacturers of cleaning and washing compounds (including detergents, shampoos, fabric softeners, toothpastes and household cleaners), paints, cosmetics, food, beverages, nutritional supplements, agricultural products and plastics. Its Surfactants segment offers products, which are principal ingredients in consumer and industrial cleaning products, such as detergents for washing clothes, dishes, carpets, floors and walls, as well as shampoos and body washes. Its Polymers segment includes polyurethane polyols, polyester resins and phthalic anhydride. Its Specialty Products segment includes flavors, emulsifiers and solubilizers used in food, flavoring, nutritional supplement and pharmaceutical applications.
BioAmber Inc. (BioAmber), formerly DNP Green Technology, Inc., is an industrial biotechnology company, which produces sustainable chemicals. The Company’s technology platform combines industrial biotechnology and chemical catalysis to convert renewable feedstocks into sustainable chemicals that are replacements for petroleum-derived chemicals, which are used in a range of everyday products, including plastics, food additives and personal care products. Its geographical segments include Europe and North America. Its product pipeline includes the derivatives of bio-succinic acid, such as 1,4 Butanediol (1,4 BDO) and tetrahydrofuran (THF), and succinic acid-based polyesters, and C6 building block chemicals, such as adipic acid, caprolactam and hexamethylenediamine (HMDA). Its products are used in various applications, including polyurethanes, resins and coatings, de-icing and coolant solutions, fine chemicals, lubricants, carpets, engineering plastics and artificial leather products.
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