Head to Head Contrast: Innospec (IOSP) versus Ecolab (ECL)
Innospec (NASDAQ: IOSP) and Ecolab (NYSE:ECL) are both basic materials companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, profitability, valuation, dividends and risk.
This table compares Innospec and Ecolab’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Volatility & Risk
Innospec has a beta of 1.18, meaning that its stock price is 18% more volatile than the S&P 500. Comparatively, Ecolab has a beta of 0.98, meaning that its stock price is 2% less volatile than the S&P 500.
Earnings & Valuation
This table compares Innospec and Ecolab’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Innospec||$1.06 billion||1.41||$150.30 million||$3.13||19.79|
|Ecolab||$13.36 billion||2.86||$2.89 billion||$4.38||30.15|
Ecolab has higher revenue and earnings than Innospec. Innospec is trading at a lower price-to-earnings ratio than Ecolab, indicating that it is currently the more affordable of the two stocks.
Insider & Institutional Ownership
90.7% of Innospec shares are owned by institutional investors. Comparatively, 75.4% of Ecolab shares are owned by institutional investors. 2.0% of Innospec shares are owned by insiders. Comparatively, 1.5% of Ecolab shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Innospec pays an annual dividend of $0.76 per share and has a dividend yield of 1.2%. Ecolab pays an annual dividend of $1.48 per share and has a dividend yield of 1.1%. Innospec pays out 24.3% of its earnings in the form of a dividend. Ecolab pays out 33.8% 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. Ecolab has raised its dividend for 31 consecutive years. Innospec is clearly the better dividend stock, given its higher yield and lower payout ratio.
This is a breakdown of recent recommendations and price targets for Innospec and Ecolab, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Innospec currently has a consensus target price of $65.00, indicating a potential upside of 4.92%. Ecolab has a consensus target price of $132.67, indicating a potential upside of 0.46%. Given Innospec’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Innospec is more favorable than Ecolab.
Ecolab beats Innospec on 9 of the 17 factors compared between the two stocks.
Innospec Inc. is a specialty chemicals company engaged in developing, manufacturing, blending, marketing and supplying of specialty chemicals for use as fuel additives and ingredients for personal care, home care, agrochemical, mining and other applications and oilfield chemicals. The Company operates through four business segments: Fuel Specialties, Performance Chemicals, Oilfield Services and Octane Additives. Its Fuel Specialties develops, manufactures, blends, markets and supplies various specialty chemical products that are used as additives for a range of fuels. Its Performance Chemicals provides technology-based solutions. Its Oilfield Services business supplies drilling, completion and production chemicals. Its Octane Additives business manufactures a fuel additive for use in automotive gasoline and provides services in respect of environmental remediation. Its customers include oil and gas exploration and production companies, fuel users, and oil refiners among others.
Ecolab Inc. provides water, hygiene and energy technologies and services. The Company’s cleaning and sanitizing programs and products, pest elimination services and equipment maintenance and repair services support customers in the foodservice, food and beverage processing, hospitality, healthcare, government and education, retail, textile care and commercial facilities management sectors in over 170 countries. Its segments include Global Industrial, Global Institutional, Global Energy, Other and Corporate. Its Global Industrial segment consists of the Water, Food and Beverage, Paper and Textile Care operating units. Its Global Institutional segment consists of the Institutional, Specialty and Healthcare operating units. The Global Energy segment provides on-site and technology-driven solutions to the global drilling, oil and gas production, refining, and petrochemical industries. The Company’s Other segment consists of the Pest Elimination and Equipment Care operating units.
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