Perimeter Solutions (NYSE:PRM) vs. Element Solutions (NYSE:ESI) Head-To-Head Review

Perimeter Solutions (NYSE:PRM) and Element Solutions (NYSE:ESI) are both mid-cap basic materials companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, valuation, profitability, earnings, risk, institutional ownership and analyst recommendations.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Perimeter Solutions and Element Solutions, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Perimeter Solutions	1	1	4	0	2.50
Element Solutions	0	3	5	3	3.00

Perimeter Solutions presently has a consensus price target of $43.00, suggesting a potential upside of 25.21%. Element Solutions has a consensus price target of $43.00, suggesting a potential upside of 14.76%. Given Perimeter Solutions’ higher possible upside, research analysts clearly believe Perimeter Solutions is more favorable than Element Solutions.

Profitability

This table compares Perimeter Solutions and Element Solutions’ 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%
Element Solutions	5.32%	14.19%	7.30%

Volatility & Risk

Perimeter Solutions has a beta of 1.9, suggesting that its share price is 90% more volatile than the S&P 500. Comparatively, Element Solutions has a beta of 1.23, suggesting that its share price is 23% more volatile than the S&P 500.

Valuation and Earnings

This table compares Perimeter Solutions and Element Solutions”s revenue, earnings per share 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
Element Solutions	$2.55 billion	3.58	$190.80 million	$0.62	60.43

Element Solutions has higher revenue and earnings than Perimeter Solutions. Perimeter Solutions is trading at a lower price-to-earnings ratio than Element Solutions, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

89.9% of Perimeter Solutions shares are owned by institutional investors. Comparatively, 92.3% of Element Solutions shares are owned by institutional investors. 13.1% of Perimeter Solutions shares are owned by company insiders. Comparatively, 6.2% of Element Solutions shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Element Solutions beats Perimeter Solutions on 9 of the 15 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 Element Solutions

Element Solutions Inc operates as a specialty chemicals company in the United States, China, and internationally. The company operates in two segments, Electronics, and Industrial & Specialty. The Electronics segment researches, formulates, and sells specialty chemicals and materials for various types of electronics hardware products. This segment also supplies surface mount technologies, fluxes, thermal management material, coatings, and other attachment materials; chemical formulations to the electronics industry; and advanced copper interconnects, die attachment, sintered silver material, adhesives, wafer bump processes, and photomask technologies for semiconductor industry. It primarily serves mobile communications, computers, automobiles, and aerospace equipment industries. The Industrial & Specialty segment provides industrial solutions, which include chemical systems that protect and decorate metal and plastic surfaces; consumable chemicals that enable printing image transfer on flexible packaging materials; and chemistries used in water-based hydraulic control fluids for offshore energy production applications. It serves aerospace, automotive, construction, consumer electronics, consumer packaged goods, and oil and gas production end markets. The company was formerly known as Platform Specialty Products Corporation and changed its name to Element Solutions Inc in January 2019. Element Solutions Inc was founded in 1785 and is headquartered in Fort Lauderdale, Florida.