Analyzing Airgas (ARG) and PQ Group (PQG)
Airgas (NYSE: ARG) and PQ Group (NYSE:PQG) are both mid-cap commodity chemicals – nec companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, dividends, profitability, institutional ownership, analyst recommendations, risk and valuation.
Insider & Institutional Ownership
58.3% of PQ Group shares are held by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
This is a breakdown of current ratings and price targets for Airgas and PQ Group, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
PQ Group has a consensus price target of $19.75, suggesting a potential upside of 16.93%. Given PQ Group’s higher probable upside, analysts clearly believe PQ Group is more favorable than Airgas.
Earnings and Valuation
This table compares Airgas and PQ Group’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|PQ Group||$1.06 billion||2.15||-$79.74 million||$0.04||422.25|
Airgas has higher earnings, but lower revenue than PQ Group. Airgas is trading at a lower price-to-earnings ratio than PQ Group, indicating that it is currently the more affordable of the two stocks.
Airgas pays an annual dividend of $2.40 per share and has a dividend yield of 1.7%. PQ Group does not pay a dividend. Airgas pays out 53.0% of its earnings in the form of a dividend. Airgas has raised its dividend for 15 consecutive years.
This table compares Airgas and PQ Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Airgas, Inc. is a supplier of industrial, medical and specialty gases, and hard goods, such as welding equipment and related products. The Company is also a producer of atmospheric gases, carbon dioxide, dry ice and nitrous oxide and a supplier of safety products, refrigerants, ammonia products and process chemicals. It operates through two segments: Distribution and All Other Operations. The Distribution segment offers a portfolio of related gas and hard goods products and services to the end customers. The All Other Operations segment consists of five business units which manufacture or distribute carbon dioxide, dry ice, nitrous oxide, ammonia and refrigerant gases. It also offers supply chain management services and solutions, and product and process technical support across many customer segments. It markets its products and services through multiple sales channels, including branch-based sales representatives, retail stores and strategic customer account programs, among others.
About PQ Group
PQ Group Holdings Inc is a global provider of catalysts, specialty materials, chemicals and services that enable environmental improvements. The Company’s products and solutions help companies produce vehicles with fuel efficiency. The Company has developed zeolite-based catalysts to reduce pollutants in diesel engines. The Company’s segments include environmental catalysts and services, and performance materials and chemicals. Environmental catalysts and services segment has three product groups, including silica catalysts, zeolite catalysts, and refining services. Silica catalysts product group sells both the finished catalyst and catalysts supports, for the production of high-density polyethylene (HDPE).zeolite catalysts product group is a supplier of emissions control catalysts as well as a supplier of specialty catalysts, precursors, and formulations. Performance materials and chemicals segment has two product groups, including performance materials and performance chemicals.
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