Axiall (NYSE: AXLL) and Trecora Resources (NYSE:TREC) are both basic materials companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, risk, institutional ownership, valuation, analyst recommendations and dividends.

Dividends

Axiall pays an annual dividend of $0.64 per share and has a dividend yield of 1.9%. Trecora Resources does not pay a dividend. Axiall pays out -5.0% of its earnings in the form of a dividend.

Insider & Institutional Ownership

42.7% of Trecora Resources shares are owned by institutional investors. 6.6% of Trecora Resources shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Axiall and Trecora Resources, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Axiall 0 0 0 0 N/A
Trecora Resources 0 0 3 0 3.00

Trecora Resources has a consensus target price of $15.33, suggesting a potential upside of 17.05%. Given Trecora Resources’ higher probable upside, analysts plainly believe Trecora Resources is more favorable than Axiall.

Valuation and Earnings

This table compares Axiall and Trecora Resources’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Axiall N/A N/A N/A ($12.69) -2.60
Trecora Resources $212.40 million 1.50 $19.42 million $0.13 100.78

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

Profitability

This table compares Axiall and Trecora Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Axiall -3.52% -7.36% -2.47%
Trecora Resources 1.37% 3.74% 2.09%

Summary

Trecora Resources beats Axiall on 9 of the 11 factors compared between the two stocks.

Axiall Company Profile

Axiall Corporation (Axiall) is a manufacturer and international marketer of chemicals and building products. The Company operates through two segments: chlorovinyls and building products. Its products include chlorine, caustic soda, vinyl chloride monomer, siding and exterior accessories, and pipe and pipe fittings, among others. The Company’s chlorovinyls segment produces a chain of products, including chlor-alkali and derivative products, such as vinyl resins, ethylene dichloride (or 1, 2 dichloroethane) (EDC), chlorinated solvents, calcium hypochlorite, hydrochloric acid (HCL) and phosgene derivatives, and compound products, such as vinyl compounds and compound additives and plasticizers. The Company’s building products segment consists of over two primary product groups: window and door profiles and trim, moldings and deck products, and outdoor building products, which includes siding and exterior accessories, pipe and pipe fittings.

Trecora Resources Company Profile

Trecora Resources (TREC) is a provider of high-purity specialty hydrocarbons and waxes. TREC owns and operates a facility located in southeast Texas, just north of Beaumont, which specializes in high-purity hydrocarbons and other petrochemical manufacturing. The Company operates through two segments: specialty petrochemical products and specialty synthetic waxes. The specialty petrochemical products segment operates through South Hampton Resources, Inc. (SHR). The specialty synthetic wax segment operates through Trecora Chemical, Inc. (TC). SHR owns and operates a specialty petrochemical facility that produces hydrocarbons and other petroleum-based products, including isopentane, normal pentane, isohexane and hexane. TC produces specialty polyethylene and poly alpha olefin waxes, and provides custom processing services. In addition, the Company is the 33.4% owner of Al Masane Al Kobra Mining Co., a Saudi Arabian joint stock company.

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