Celanese Corporation (CE) versus Praxair (PX) Critical Analysis
Celanese Corporation (NYSE: CE) and Praxair (NYSE:PX) are both large-cap basic materials companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, earnings, valuation, dividends, risk, profitability and institutional ownership.
Valuation and Earnings
This table compares Celanese Corporation and Praxair’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Celanese Corporation||$5.62 billion||2.62||$1.16 billion||$5.89||18.15|
|Praxair||$10.92 billion||3.68||$3.54 billion||$5.35||26.28|
Praxair has higher revenue and earnings than Celanese Corporation. Celanese Corporation is trading at a lower price-to-earnings ratio than Praxair, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
97.2% of Celanese Corporation shares are held by institutional investors. Comparatively, 85.3% of Praxair shares are held by institutional investors. 0.4% of Celanese Corporation shares are held by company insiders. Comparatively, 0.2% of Praxair shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Celanese Corporation pays an annual dividend of $1.84 per share and has a dividend yield of 1.7%. Praxair pays an annual dividend of $3.15 per share and has a dividend yield of 2.2%. Celanese Corporation pays out 31.2% of its earnings in the form of a dividend. Praxair pays out 58.9% 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. Celanese Corporation has increased its dividend for 12 consecutive years and Praxair has increased its dividend for 5 consecutive years.
Risk & Volatility
Celanese Corporation has a beta of 1.31, meaning that its share price is 31% more volatile than the S&P 500. Comparatively, Praxair has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500.
This is a summary of recent recommendations and price targets for Celanese Corporation and Praxair, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Celanese Corporation presently has a consensus price target of $102.85, indicating a potential downside of 3.79%. Praxair has a consensus price target of $136.89, indicating a potential downside of 2.65%. Given Praxair’s higher possible upside, analysts plainly believe Praxair is more favorable than Celanese Corporation.
This table compares Celanese Corporation and Praxair’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Celanese Corporation beats Praxair on 12 of the 18 factors compared between the two stocks.
Celanese Corporation Company Profile
Celanese Corporation (Celanese) is a technology and specialty materials company. The Company’s segments include Advanced Engineered Materials, Consumer Specialties, Industrial Specialties, Acetyl Intermediates and Other Activities. The Advanced Engineered Materials segment includes the Company’s engineered materials business and certain affiliates. The Consumer Specialties segment includes the Company’s cellulose derivatives and food ingredients businesses, which serve consumer-driven applications. The Industrial Specialties segment includes the Company’s emulsion polymers and ethylene vinyl acetate (EVA) polymers businesses. The Acetyl Intermediates segment includes the Company’s intermediate chemistry business, which produces and supplies acetyl products, including acetic acid, vinyl acetate monomer (VAM), acetic anhydride and acetate esters. The Company has operations in North America, Europe and Asia. As of December 31, 2016, the Company had 30 global production facilities.
Praxair Company Profile
Praxair, Inc. is an industrial gas company. The Company’s operations are organized into five segments, four of which have been determined on a geographic basis of segmentation: North America, Europe, South America and Asia. In addition, it operates its surface technologies business through its subsidiary, Praxair Surface Technologies, Inc., which represents the fifth segment. Its operations consist of two product lines: industrial gases and surface technologies. Its industrial gases product line centers on the manufacturing and distribution of atmospheric gases (oxygen, nitrogen, argon, rare gases) and process gases (carbon dioxide, helium, hydrogen, electronic gases, specialty gases). It also designs, engineers and builds equipment that produces industrial gases primarily for internal use. Its Surface Technologies segment, operated through Praxair Surface Technologies, Inc., supplies wear-resistant and high-temperature corrosion-resistant metallic and ceramic coatings and powders.
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