Eastman Chemical (NYSE: EMN) and Ingevity (NYSE:NGVT) 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 risk, analyst recommendations, dividends, institutional ownership, valuation, earnings and profitability.

Dividends

Eastman Chemical pays an annual dividend of $2.04 per share and has a dividend yield of 2.2%. Ingevity does not pay a dividend. Eastman Chemical pays out 29.2% of its earnings in the form of a dividend. Eastman Chemical has raised its dividend for 5 consecutive years.

Valuation and Earnings

This table compares Eastman Chemical and Ingevity’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Eastman Chemical $9.01 billion 1.46 $854.00 million $6.98 13.11
Ingevity $908.30 million 3.55 $35.20 million $2.22 34.46

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

Insider & Institutional Ownership

82.7% of Eastman Chemical shares are held by institutional investors. Comparatively, 91.4% of Ingevity shares are held by institutional investors. 1.1% of Eastman Chemical shares are held by company insiders. Comparatively, 0.1% of Ingevity shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and price targets for Eastman Chemical and Ingevity, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Eastman Chemical 0 8 7 0 2.47
Ingevity 0 0 6 0 3.00

Eastman Chemical presently has a consensus target price of $95.62, suggesting a potential upside of 4.50%. Ingevity has a consensus target price of $76.00, suggesting a potential downside of 0.67%. Given Eastman Chemical’s higher probable upside, research analysts plainly believe Eastman Chemical is more favorable than Ingevity.

Profitability

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

Net Margins Return on Equity Return on Assets
Eastman Chemical 10.89% 22.77% 6.96%
Ingevity 9.86% 58.14% 12.09%

Risk and Volatility

Eastman Chemical has a beta of 1.31, suggesting that its share price is 31% more volatile than the S&P 500. Comparatively, Ingevity has a beta of 1.78, suggesting that its share price is 78% more volatile than the S&P 500.

Summary

Eastman Chemical beats Ingevity on 9 of the 17 factors compared between the two stocks.

Eastman Chemical Company Profile

Eastman Chemical Company (Eastman) is an advanced materials and specialty additives company. The Company’s segments include Additives & Functional Products (AFP), Advanced Materials (AM), Chemical Intermediates (CI), and Fibers. In the AFP segment, it manufactures chemicals for products in the coatings, tires, consumables, building and construction, industrial applications, including solar energy markets, animal nutrition, care chemicals, crop protection, and energy markets. In the AM segment, it produces and markets its polymers, films, and plastics with differentiated performance properties for end uses in transportation, consumables, building and construction, durable goods, and health and wellness products. The CI segment leverages large scale and vertical integration from the cellulose and acetyl, olefins, and alkylamines streams to support its specialty operating segments. Its product lines in Fibers segment include Acetate Tow, Acetate Yarn and Acetyl Chemical Products.

Ingevity Company Profile

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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