Perimeter Solutions (NYSE:PRM – Get Free Report) and NL Industries (NYSE:NL – Get Free Report) are both basic materials companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, earnings, risk, institutional ownership, profitability, analyst recommendations and valuation.
Earnings and Valuation
This table compares Perimeter Solutions and NL Industries”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Perimeter Solutions | $652.86 million | 8.58 | -$206.37 million | ($1.34) | -25.63 |
| NL Industries | $158.30 million | 1.82 | -$37.83 million | ($0.69) | -8.53 |
Volatility and Risk
Perimeter Solutions has a beta of 1.9, suggesting that its stock price is 90% more volatile than the S&P 500. Comparatively, NL Industries has a beta of 0.2, suggesting that its stock price is 80% less volatile than the S&P 500.
Insider and Institutional Ownership
89.9% of Perimeter Solutions shares are held by institutional investors. Comparatively, 10.7% of NL Industries shares are held by institutional investors. 13.1% of Perimeter Solutions shares are held by insiders. Comparatively, 0.3% of NL Industries shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Profitability
This table compares Perimeter Solutions and NL Industries’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Perimeter Solutions | -26.93% | 18.29% | 7.73% |
| NL Industries | -21.56% | -8.74% | -7.02% |
Analyst Ratings
This is a summary of current ratings and price targets for Perimeter Solutions and NL Industries, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Perimeter Solutions | 1 | 1 | 4 | 0 | 2.50 |
| NL Industries | 0 | 1 | 0 | 0 | 2.00 |
Perimeter Solutions presently has a consensus target price of $43.00, suggesting a potential upside of 25.21%. Given Perimeter Solutions’ stronger consensus rating and higher possible upside, analysts plainly believe Perimeter Solutions is more favorable than NL Industries.
Summary
Perimeter Solutions beats NL Industries on 10 of the 14 factors compared between the two stocks.
About Perimeter Solutions
Perimeter Solutions, SA manufactures and supplies firefighting products and lubricant additives in the United States, Germany, and internationally. It operates in two segments, Fire Safety and Specialty Products. The Fire Safety segment provides fire retardants and firefighting foams, as well as specialized equipment and services for federal, state, provincial, local/municipal, and commercial customers. The Specialty Products segment produces and sells Phosphorus Pentasulfide, which is primarily used in the preparation of lubricant additives, including a family of compounds called Zinc Dialkyldithiophosphates. The company offers its products under the PHOS-CHEK, FIRE-TROL, AUXQUIMIA, and SOLBERG brands. Perimeter Solutions, SA was founded in 1963 and is headquartered in Clayton, Missouri.
About NL Industries
NL Industries, Inc., through its subsidiary, CompX International Inc., operates in the component products industry in Europe, North America, the Asia Pacific, and internationally. The company manufactures and sells mechanical and electronic cabinet locks and other locking mechanisms, including disc tumbler locks; pin tumbler locking mechanisms under KeSet, System 64, TuBar, and Turbine brands; and electronic locks under CompX eLock and StealthLock brands for use in various applications, such as mailboxes, ignition systems, file cabinets, desk drawers, tool storage cabinets, high security medical cabinetry, integrated inventory and access control secured narcotics boxes, electronic circuit panels, storage compartments, gas station security, vending and cash containment machines. It also offers original equipment and aftermarket stainless steel exhaust headers, exhaust pipes, mufflers, and other exhaust components; gauges, such as GPS speedometers and tachometers; mechanical and electronic controls and throttles; wake enhancement devices, trim tabs, steering wheels, and other billet aluminum accessories; dash panels, LED indicators, wire harnesses, and other accessories; and grab handles, pin cleats, and other accessories; primarily for performance and ski/wakeboard and performance boats. In addition, the company produces and markets value-added titanium dioxide pigments, a base industrial product used in imparting whiteness, brightness, opacity, and durability to a diverse range of customer applications and end-use markets, including coatings, plastics, paper, inks, cosmetics, pharmaceuticals, and other industrial and consumer products. The company sells its component products directly to original equipment manufacturers, as well as through distributors. NL Industries, Inc. was founded in 1891 and is based in Dallas, Texas. NL Industries, Inc. operates as a subsidiary of Valhi, Inc.
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