Head to Head Review: Air Products and Chemicals (NYSE:APD) versus Oil-Dri Corporation Of America (NYSE:ODC)

Oil-Dri Corporation Of America (NYSE:ODC) and Air Products and Chemicals (NYSE:APD) are both basic materials companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, risk, profitability, analyst recommendations and dividends.

Dividends

Oil-Dri Corporation Of America pays an annual dividend of $0.72 per share and has a dividend yield of 1.5%. Air Products and Chemicals pays an annual dividend of $7.16 per share and has a dividend yield of 2.9%. Oil-Dri Corporation Of America pays out 19.8% of its earnings in the form of a dividend. Air Products and Chemicals pays out -402.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Oil-Dri Corporation Of America has raised its dividend for 11 consecutive years and Air Products and Chemicals has raised its dividend for 50 consecutive years. Air Products and Chemicals is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

Oil-Dri Corporation Of America has a beta of 0.75, indicating that its share price is 25% less volatile than the S&P 500. Comparatively, Air Products and Chemicals has a beta of 0.86, indicating that its share price is 14% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Oil-Dri Corporation Of America and Air Products and Chemicals, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Oil-Dri Corporation Of America	0	0	1	0	3.00
Air Products and Chemicals	2	6	7	1	2.44

Air Products and Chemicals has a consensus target price of $292.47, suggesting a potential upside of 18.17%. Given Air Products and Chemicals’ higher probable upside, analysts clearly believe Air Products and Chemicals is more favorable than Oil-Dri Corporation Of America.

Profitability

This table compares Oil-Dri Corporation Of America and Air Products and Chemicals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Oil-Dri Corporation Of America	11.10%	21.06%	14.19%
Air Products and Chemicals	-3.28%	15.18%	6.64%

Institutional & Insider Ownership

49.0% of Oil-Dri Corporation Of America shares are held by institutional investors. Comparatively, 81.7% of Air Products and Chemicals shares are held by institutional investors. 11.7% of Oil-Dri Corporation Of America shares are held by insiders. Comparatively, 1.9% of Air Products and Chemicals shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Oil-Dri Corporation Of America and Air Products and Chemicals”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Oil-Dri Corporation Of America	$485.57 million	1.48	$54.00 million	$3.64	13.52
Air Products and Chemicals	$12.04 billion	4.58	-$394.50 million	($1.78)	-139.04

Oil-Dri Corporation Of America has higher earnings, but lower revenue than Air Products and Chemicals. Air Products and Chemicals is trading at a lower price-to-earnings ratio than Oil-Dri Corporation Of America, indicating that it is currently the more affordable of the two stocks.

Summary

Air Products and Chemicals beats Oil-Dri Corporation Of America on 10 of the 18 factors compared between the two stocks.

About Oil-Dri Corporation Of America

Oil-Dri Corporation of America is a manufacturer and supplier of specialty sorbent products for the pet care, animal health and nutrition, fluids purification, agricultural ingredients, sports field, industrial and automotive markets. It operates through the Business to Business Products Group and Retail and Wholesale Products Group segments. The Business to Business Products Group segment’s customers include processors and refiners of edible oils, jet fuel and biofuel, manufacturers of animal feed and agricultural chemicals, distributors of animal health and nutrition products, and marketers of consumer products. The Retail and Wholesale Products Group segment customers include retailers of cat litter and related accessories such as mass merchandisers, drugstore chains, pet specialty retail outlets, dollar stores, retail grocery stores as well as distributors of industrial cleanup and automotive products, environmental service companies, and sports field product users. The company was founded by Nick Jaffee in 1941 and is headquartered in Chicago, IL.

About Air Products and Chemicals

Air Products and Chemicals, Inc. provides atmospheric gases, process and specialty gases, equipment, and related services in the Americas, Asia, Europe, the Middle East, India, and internationally. The company produces atmospheric gases, including oxygen, nitrogen, and argon; process gases, such as hydrogen, helium, carbon dioxide, carbon monoxide, and syngas; and specialty gases for customers in various industries, including refining, chemical, manufacturing, electronics, energy production, medical, food, and metals. It also designs and manufactures equipment for air separation, hydrocarbon recovery and purification, natural gas liquefaction, and liquid helium and liquid hydrogen transport and storage. The company was founded in 1940 and is headquartered in Allentown, Pennsylvania.