Ingevity (NYSE: NGVT) and NewMarket (NYSE:NEU) are both mid-cap basic materials companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, risk, dividends, institutional ownership and profitability.
NewMarket pays an annual dividend of $7.00 per share and has a dividend yield of 1.8%. Ingevity does not pay a dividend. NewMarket pays out 35.8% of its earnings in the form of a dividend. NewMarket has increased its dividend for 8 consecutive years.
Ingevity has a beta of 1.78, suggesting that its stock price is 78% more volatile than the S&P 500. Comparatively, NewMarket has a beta of 0.8, suggesting that its stock price is 20% less volatile than the S&P 500.
This is a summary of current ratings and price targets for Ingevity and NewMarket, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Ingevity currently has a consensus price target of $76.00, suggesting a potential downside of 3.87%. Given Ingevity’s higher probable upside, analysts plainly believe Ingevity is more favorable than NewMarket.
Earnings & Valuation
This table compares Ingevity and NewMarket’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Ingevity||$908.30 million||3.67||$35.20 million||$2.22||35.61|
|NewMarket||$2.05 billion||2.29||$243.44 million||$19.58||20.26|
NewMarket has higher revenue and earnings than Ingevity. NewMarket is trading at a lower price-to-earnings ratio than Ingevity, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
91.4% of Ingevity shares are held by institutional investors. Comparatively, 58.8% of NewMarket shares are held by institutional investors. 0.1% of Ingevity shares are held by company insiders. Comparatively, 16.8% of NewMarket shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
This table compares Ingevity and NewMarket’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Ingevity Corporation is a manufacturer of specialty chemicals and high performance carbon materials. The Company is also a manufacturer of activated carbon used in gasoline vapor emission control systems in cars, trucks, motorcycles and boats. The Company operates through two segments: Performance Materials and Performance Chemicals. The Performance Materials segment primarily produces automotive carbon products used in gasoline vapor emission control systems in cars, trucks, motorcycles and boats. The Performance Chemicals segment develops, manufactures and sells a range of specialty chemicals primarily derived from co-products of the Kraft pulping process. Its products are used in a range of applications, including asphalt paving, oil exploration and production, agrochemicals, adhesives, lubricants, publication inks and automotive components that reduce gasoline vapor emissions.
NewMarket Corporation is a holding company. The Company is the parent company of Afton Chemical Corporation (Afton), Ethyl Corporation (Ethyl), NewMarket Services Corporation (NewMarket Services), and NewMarket Development Corporation (NewMarket Development). The Company operates through petroleum additives segment, which is primarily represented by Afton. The Company manufactures chemical components that are selected to perform one or more specific functions and combine those chemicals with other chemicals or components to form additive packages for use in specified end user applications. The petroleum additives product applications include lubricant additives and fuel additives. The Company’s All other category includes the operations of the TEL business, as well as contract manufacturing and services performed by Ethyl. The Ethyl plant facility is located in Houston, Texas. It is involved in terminal operations related to TEL and other fuel additives.
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