Chemtura (CHMT) vs. Ecolab (ECL) Financial Survey

Ecolab (NYSE: ECL) and Chemtura (NYSE:CHMT) are both basic materials companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, profitability, risk, institutional ownership, analyst recommendations, earnings and dividends.

Valuation and Earnings

This table compares Ecolab and Chemtura’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ecolab $13.15 billion 3.01 $1.23 billion $4.44 30.86
Chemtura N/A N/A N/A ($0.19) N/A

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

Insider and Institutional Ownership

76.6% of Ecolab shares are held by institutional investors. Comparatively, 93.1% of Chemtura shares are held by institutional investors. 1.5% of Ecolab shares are held by company insiders. Comparatively, 2.6% of Chemtura shares are held 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.

Profitability

This table compares Ecolab and Chemtura’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ecolab 9.67% 19.05% 6.97%
Chemtura 5.71% 9.00% 4.02%

Analyst Recommendations

This is a summary of current ratings and price targets for Ecolab and Chemtura, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ecolab 0 10 6 0 2.38
Chemtura 0 0 0 0 N/A

Ecolab presently has a consensus price target of $136.38, indicating a potential downside of 0.46%.

Dividends

Ecolab pays an annual dividend of $1.48 per share and has a dividend yield of 1.1%. Chemtura does not pay a dividend. Ecolab pays out 33.3% of its earnings in the form of a dividend. Ecolab has increased its dividend for 32 consecutive years.

Summary

Ecolab beats Chemtura on 9 of the 12 factors compared between the two stocks.

Ecolab Company Profile

Ecolab Inc. provides water, hygiene and energy technologies and services. The Company’s cleaning and sanitizing programs and products, pest elimination services and equipment maintenance and repair services support customers in the foodservice, food and beverage processing, hospitality, healthcare, government and education, retail, textile care and commercial facilities management sectors in over 170 countries. Its segments include Global Industrial, Global Institutional, Global Energy, Other and Corporate. Its Global Industrial segment consists of the Water, Food and Beverage, Paper and Textile Care operating units. Its Global Institutional segment consists of the Institutional, Specialty and Healthcare operating units. The Global Energy segment provides on-site and technology-driven solutions to the global drilling, oil and gas production, refining, and petrochemical industries. The Company’s Other segment consists of the Pest Elimination operating units.

Chemtura Company Profile

Chemtura Corporation is a chemical company. The Company is engaged in developing, manufacturing and marketing of engineered industrial specialty chemicals. The Company’s products are sold to industrial manufacturing customers for use as additives, ingredients or intermediates. The Company’s segments are Industrial Performance Products and Industrial Engineered Products. The Industrial Performance Products segment manufactures and markets lubricant additive components, synthetic lubricant base-stocks, synthetic finished fluids, calcium sulfonate specialty greases and phosphate and polyester based fluids, and is also engaged in the development and production of hot cast elastomer pre-polymers. The Industrial Engineered Products segment develops and manufactures bromine and bromine-based products and organometallic compounds. The Company operates in a range of industries, including automotive, building and construction, electronics, lubricants, packaging and transportation.

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