Financial Analysis: NewMarket (NYSE:NEU) vs. Elementis (OTCMKTS:ELMTY)

NewMarket (NYSE:NEU) and Elementis (OTCMKTS:ELMTY) are both basic materials companies, but which is the better business? We will compare the two companies based on the strength of their risk, institutional ownership, valuation, dividends, analyst recommendations, profitability and earnings.

Dividends

NewMarket pays an annual dividend of $12.00 per share and has a dividend yield of 1.5%. Elementis pays an annual dividend of $0.19 per share and has a dividend yield of 2.5%. NewMarket pays out 27.4% of its earnings in the form of a dividend. NewMarket has increased its dividend for 7 consecutive years.

Volatility & Risk

NewMarket has a beta of 0.52, meaning that its share price is 48% less volatile than the S&P 500. Comparatively, Elementis has a beta of 0.11, meaning that its share price is 89% less volatile than the S&P 500.

Profitability

This table compares NewMarket and Elementis’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NewMarket	15.25%	24.12%	12.24%
Elementis	N/A	N/A	N/A

Valuation and Earnings

This table compares NewMarket and Elementis”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NewMarket	$2.73 billion	2.66	$418.75 million	$43.78	17.99
Elementis	$597.50 million	1.79	-$45.50 million	N/A	N/A

NewMarket has higher revenue and earnings than Elementis.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for NewMarket and Elementis, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NewMarket	0	1	0	0	2.00
Elementis	0	0	0	0	0.00

Insider and Institutional Ownership

61.1% of NewMarket shares are owned by institutional investors. 8.6% of NewMarket shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Summary

NewMarket beats Elementis on 11 of the 13 factors compared between the two stocks.

About NewMarket

NewMarket Corporation, through its subsidiaries, primarily engages in the manufacture and sale of petroleum additives. The company offers lubricant additives for use in various vehicle and industrial applications, including engine oils, transmission fluids, off-road powertrain and hydraulic systems, gear oils, hydraulic oils, turbine oils, and other applications where metal-to-metal moving parts are utilized; engine oil additives designed for passenger cars, motorcycles, on and off-road heavy duty commercial equipment, locomotives, and engines in ocean-going vessels; driveline additives designed for products, such as transmission fluids, axle fluids, and off-road powertrain fluids; and industrial additives designed for products for industrial applications consisting of hydraulic fluids, grease, industrial gear fluids, and industrial specialty applications, such as turbine oils. It also provides fuel additives that are used to enhance the oil refining process and the performance of gasoline, diesel, biofuels, and other fuels to industry, government, original equipment manufacturers, and individual customers. In addition, the company engages in the marketing of antiknock compounds, as well as contracted manufacturing and services activities; and owns and manages a real property in Virginia. It operates in North America, Latin America, Asia Pacific, Europe, the Middle East, Africa, and India. NewMarket Corporation was founded in 1887 and is headquartered in Richmond, Virginia.

About Elementis

Elementis plc operates as a specialty chemical company in the United Kingdom, rest of Europe, North America, and internationally. It operates in two segments, Performance Specialties and Personal Care. The Performance Specialties segment engages in the production of rheological modifiers and additives for decorative and industrial coatings; and production and supply of talc for use in plastics, coatings, technical ceramics, and paper sectors. The Personal Care segment provides rheological modifiers and compounded products, including active ingredients for antiperspirants (AP) deodorants for personal care manufacturers. The company offers personal care products for antiperspirants, color cosmetics, and skin care applications; and performance specialties products for architectural coatings, adhesives, sealants and construction additives, and talc applications. Elementis plc was founded in 1844 and is headquartered in London, the United Kingdom.