Quaker Chemical (NYSE: KWR) and Ingevity (NYSE:NGVT) are both mid-cap basic materials companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, dividends, risk, profitability, earnings and institutional ownership.

Volatility & Risk

Quaker Chemical has a beta of 1.35, suggesting that its stock price is 35% more volatile than the S&P 500. Comparatively, Ingevity has a beta of 1.78, suggesting that its stock price is 78% more volatile than the S&P 500.

Dividends

Quaker Chemical pays an annual dividend of $1.42 per share and has a dividend yield of 0.9%. Ingevity does not pay a dividend. Quaker Chemical pays out 40.0% of its earnings in the form of a dividend. Ingevity has raised its dividend for 7 consecutive years.

Insider & Institutional Ownership

86.7% of Quaker Chemical shares are held by institutional investors. Comparatively, 91.4% of Ingevity shares are held by institutional investors. 3.6% of Quaker Chemical shares are held by insiders. Comparatively, 0.1% of Ingevity shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Quaker Chemical and Ingevity, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Quaker Chemical 0 3 0 0 2.00
Ingevity 0 0 6 0 3.00

Quaker Chemical currently has a consensus price target of $161.00, indicating a potential upside of 0.36%. Ingevity has a consensus price target of $76.00, indicating a potential downside of 3.87%. Given Quaker Chemical’s higher probable upside, research analysts plainly believe Quaker Chemical is more favorable than Ingevity.

Earnings and Valuation

This table compares Quaker Chemical and Ingevity’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Quaker Chemical $746.66 million 2.86 $61.40 million $3.55 45.19
Ingevity $908.30 million 3.67 $35.20 million $2.22 35.61

Quaker Chemical has higher earnings, but lower revenue than Ingevity. Ingevity is trading at a lower price-to-earnings ratio than Quaker Chemical, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Quaker Chemical and Ingevity’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Quaker Chemical 5.93% 15.43% 9.20%
Ingevity 9.86% 58.14% 12.09%

Summary

Ingevity beats Quaker Chemical on 11 of the 17 factors compared between the two stocks.

About Quaker Chemical

Quaker Chemical Corporation is a provider of process fluids, chemical specialties, and technical expertise to a range of industries, including steel, aluminum, mining, aerospace, tube and pipe, cans and others. The Company’s segments include North America, Europe, Middle East and Africa (EMEA), Asia/Pacific and South America. It develops, produces, and markets a range of formulated chemical specialty products and offers chemical management services. Its products and services include rolling lubricants (used by manufacturers of steel in the hot and cold rolling of steel and by manufacturers of aluminum in the hot rolling of aluminum); machining and grinding compounds (used by metalworking customers in cutting, shaping, and grinding metal parts, which require special treatment to enable them to tolerate the manufacturing process, achieve closer tolerance, and improve tool life), and hydraulic fluids (used by steel, metalworking, and other customers to operate hydraulic equipment).

About Ingevity

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.

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