Innophos (NASDAQ: IPHS) and Koppers (NYSE:KOP) are both small-cap basic materials companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, dividends, analyst recommendations, profitability, risk, institutional ownership and valuation.
Valuation and Earnings
This table compares Innophos and Koppers’ gross revenue, earnings per share (EPS) and valuation.
||Earnings Per Share
Innophos has higher earnings, but lower revenue than Koppers. Innophos is trading at a lower price-to-earnings ratio than Koppers, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current ratings and recommmendations for Innophos and Koppers, as provided by MarketBeat.com.
||Strong Buy Ratings
Innophos currently has a consensus target price of $56.00, indicating a potential upside of 26.67%. Koppers has a consensus target price of $45.75, indicating a potential downside of 5.77%. Given Innophos’ higher probable upside, equities research analysts plainly believe Innophos is more favorable than Koppers.
Risk and Volatility
Innophos has a beta of 0.86, meaning that its stock price is 14% less volatile than the S&P 500. Comparatively, Koppers has a beta of 1.01, meaning that its stock price is 1% more volatile than the S&P 500.
This table compares Innophos and Koppers’ net margins, return on equity and return on assets.
||Return on Equity
||Return on Assets
Innophos pays an annual dividend of $1.92 per share and has a dividend yield of 4.3%. Koppers does not pay a dividend. Innophos pays out 88.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Innophos has raised its dividend for 5 consecutive years.
Insider & Institutional Ownership
94.5% of Innophos shares are owned by institutional investors. Comparatively, 89.3% of Koppers shares are owned by institutional investors. 2.3% of Innophos shares are owned by insiders. Comparatively, 3.9% of Koppers shares are owned by 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.
Innophos beats Koppers on 9 of the 17 factors compared between the two stocks.
Innophos Company Profile
Innophos Holdings, Inc. is a producer of nutritional specialty ingredients with applications in food, beverage, dietary supplements, pharmaceutical, oral care and industrial end markets. The Company also provides bioactive mineral and nutritional ingredients. The Company’s segments include Specialty Phosphates US & Canada, Specialty Phosphates Mexico, and Granular Triple Super Phosphate (GTSP) & Other. The Company has four principal product lines: Specialty Ingredients; Food and Technical Grade Purified Phosphoric Acid (PPA); Technical Grade Sodium Tripolyphosphate (STPP), & Detergent Grade PPA, and GTSP & Other. The Company’s bioactive mineral ingredients are mineral-based ingredients for food, beverage and dietary supplement end markets that are manufactured to be readily digestible. The Company has its manufacturing facilities located throughout the United States, Canada, Mexico and China.
Koppers Company Profile
Koppers Holdings Inc. is a global integrated provider of treated wood products, wood treatment chemicals and carbon compounds. The Company operates through three segments: Railroad and Utility Products and Services (RUPS), Carbon Materials and Chemicals (CMC) and Performance Chemicals (PC). The RUPS business sells treated and untreated wood products, rail joint bars and services primarily to the railroad markets. The primary products supplied by PC business are copper-based wood preservatives, including micronized copper quaternary and micronized copper azole (MicroPro), micronized pigments (MicroShades) and chromated copper arsenate. Through CMC business, the Company processes coal tar into a range of products, including carbon pitch, creosote and carbon black feedstock. Its products and services are used in a range of markets, including the railroad, specialty chemical, utility, residential lumber, agriculture, aluminum, steel, rubber and construction industries.
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