Gulf Resources (NASDAQ:GURE – Get Free Report) and Tokuyama (OTCMKTS:TKYMY – Get Free Report) are both small-cap basic materials companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, valuation, earnings, risk and analyst recommendations.
Risk & Volatility
Gulf Resources has a beta of 0.37, suggesting that its stock price is 63% less volatile than the S&P 500. Comparatively, Tokuyama has a beta of 0.14, suggesting that its stock price is 86% less volatile than the S&P 500.
Earnings and Valuation
This table compares Gulf Resources and Tokuyama”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Gulf Resources | $7.66 million | 0.97 | -$58.94 million | ($48.05) | -0.10 |
| Tokuyama | $2.25 billion | 0.83 | $154.35 million | $1.17 | 11.09 |
Tokuyama has higher revenue and earnings than Gulf Resources. Gulf Resources is trading at a lower price-to-earnings ratio than Tokuyama, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
3.3% of Gulf Resources shares are owned by institutional investors. 3.2% of Gulf Resources shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Profitability
This table compares Gulf Resources and Tokuyama’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Gulf Resources | -286.77% | -20.62% | -17.50% |
| Tokuyama | 7.42% | 9.06% | 5.09% |
Analyst Ratings
This is a breakdown of recent ratings and recommmendations for Gulf Resources and Tokuyama, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Gulf Resources | 1 | 0 | 0 | 0 | 1.00 |
| Tokuyama | 0 | 0 | 0 | 0 | 0.00 |
Summary
Tokuyama beats Gulf Resources on 7 of the 12 factors compared between the two stocks.
About Gulf Resources
Gulf Resources, Inc., through its subsidiaries, manufactures and trades bromine and crude salt, chemical products, and natural gas in the People’s Republic of China. The company operates through four segments: Bromine, Crude salt, Chemical products, and Natural gas segments. It also provides bromine for use in bromine compounds, intermediates in organic synthesis, brominated flame retardants, fumigants, water purification compounds, dyes, medicines, and disinfectants. In addition, the company offers crude salt for use as a material in alkali and chlorine alkali production for use in the chemical, food and beverage, and other industries. In addition, it manufactures and sells chemical products for use in oil and gas field exploration, oil and gas distribution, oil field drilling, papermaking chemical agents, and inorganic chemicals, as well as materials that are used for human and animal antibiotics. The company is based in Shouguang, the People’s Republic of China.
About Tokuyama
Tokuyama Corporation produces and sells various chemical products in Japan. The company operates through six segments: Chemicals, Cement, Electronics and Advanced Materials, Life Science, Eco Business, and Others. The Chemicals segment offers caustic soda, soda ash, calcium chloride, sodium silicate cullet, sodium bicarbonate, purified, vinyl chloride monomer, polyvinyl chloride resin, propylene oxide, methylene chloride, and chloroform. The Cement segment provides cement, ready-mixed concrete, and cement-type stabilizer, as well as engages in the resource recycling business. The Electronic and Advanced Materials segment provides polycrystalline silicon; fumed silica and tetrachlorosilane; aluminum nitride; high-purity chemicals for electronics manufacturing and photoresist developer; and isopropyl alcohol. The Life Science segment provides medical diagnosis systems, dental materials and equipment, pharmaceutical ingredients and intermediates, plastic lens-related materials for glasses, and microporous film. The Eco Business segment offers plastic window sashes, ion exchange membranes, as well as engages in waste gypsum board recycling activity. The company was formerly known as Tokuyama Soda Co., Ltd. and changed its name to Tokuyama Corporation in April 1994. Tokuyama Corporation was incorporated in 1918 and is headquartered in Tokyo, Japan.
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