MDU Resources Group (MDU) vs. Compass Minerals International (CMP) Critical Comparison

MDU Resources Group (NYSE: MDU) and Compass Minerals International (NYSE:CMP) are both mid-cap utilities companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, profitability, analyst recommendations and valuation.

Analyst Ratings

This is a breakdown of current recommendations for MDU Resources Group and Compass Minerals International, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
MDU Resources Group 0 0 2 0 3.00
Compass Minerals International 1 1 4 0 2.50

MDU Resources Group currently has a consensus target price of $28.75, indicating a potential downside of 0.24%. Compass Minerals International has a consensus target price of $71.50, indicating a potential upside of 10.60%. Given Compass Minerals International’s higher probable upside, analysts plainly believe Compass Minerals International is more favorable than MDU Resources Group.

Dividends

MDU Resources Group pays an annual dividend of $0.79 per share and has a dividend yield of 2.7%. Compass Minerals International pays an annual dividend of $2.88 per share and has a dividend yield of 4.5%. MDU Resources Group pays out 63.2% of its earnings in the form of a dividend. Compass Minerals International pays out 104.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. MDU Resources Group has raised its dividend for 8 consecutive years and Compass Minerals International has raised its dividend for 14 consecutive years. Compass Minerals International is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares MDU Resources Group and Compass Minerals International’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
MDU Resources Group $4.44 billion 1.27 $281.20 million $1.25 23.06
Compass Minerals International $1.36 billion 1.60 $42.70 million $2.75 23.51

MDU Resources Group has higher revenue and earnings than Compass Minerals International. MDU Resources Group is trading at a lower price-to-earnings ratio than Compass Minerals International, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

MDU Resources Group has a beta of 0.69, meaning that its share price is 31% less volatile than the S&P 500. Comparatively, Compass Minerals International has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500.

Profitability

This table compares MDU Resources Group and Compass Minerals International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
MDU Resources Group 6.39% 10.59% 3.99%
Compass Minerals International 2.39% 12.03% 3.47%

Insider & Institutional Ownership

64.3% of MDU Resources Group shares are held by institutional investors. 1.0% of MDU Resources Group shares are held by company insiders. Comparatively, 0.9% of Compass Minerals International shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

MDU Resources Group beats Compass Minerals International on 9 of the 17 factors compared between the two stocks.

About MDU Resources Group

MDU Resources Group, Inc. engages in regulated energy delivery, and construction materials and services businesses in the United States. The company operates through five segments: Electric, Natural Gas Distribution, Pipeline and Midstream, Construction Materials and Contracting, and Construction Services. The Electric segment generates, transmits, and distributes electricity in Montana, North Dakota, South Dakota, and Wyoming. As of December 31, 2017, it served 142,901 residential, commercial, industrial, and municipal customers in 178 communities and adjacent rural areas. The Natural Gas Distribution segment distributes natural gas in Montana, North Dakota, South Dakota, and Wyoming, as well as Idaho, Minnesota, Oregon, and Washington; and offers related value-added services. It served approximately 938,867 residential, commercial, and industrial customers in 335 communities and adjacent rural areas. The Pipeline and Midstream segment provides natural gas transportation, underground storage, and gathering services primarily in the Rocky Mountain and northern Great Plains regions. It also provides cathodic protection and other energy-related services. The Construction Materials and Contracting segment mines, processes, and sells construction aggregates; produces and sells asphalt mix; and supplies ready-mixed concrete in the central, southern, and western United States, as well as Alaska and Hawaii. The Construction Services segment designs, constructs, and maintains overhead and underground electrical distribution and transmission lines, substations, external lighting, traffic signalization, and gas pipelines; electrical and communication wiring and infrastructure, and fire suppression systems; and renewable energy projects. It also offers utility excavation, and mechanical piping and services; and manufactures and distributes transmission line construction equipment and other supplies. The company was founded in 1924 and is based in Bismarck, North Dakota.

About Compass Minerals International

Compass Minerals International, Inc., produces and sells salt, and specialty plant nutrition and chemical products primarily in the United States, Canada, Brazil, and the United Kingdom. It operates in three segments: Salt, Plant Nutrition North America, and Plant Nutrition South America. The Salt segment offers sodium chloride and magnesium chloride, including rock salt, mechanically and solar evaporated salt, and brine and flake magnesium chloride products; and purchases potassium chloride and calcium chloride to sell as finished products or to blend with salt to produce specialty products. This segment provides products for use as a deicer for roadways, consumer, and professional use; as an ingredient in chemical production; for water treatment, human, and animal nutrition; and for various other consumer and industrial uses, as well as provides records management services. The Plant Nutrition North America segment offers sulfate of potash specialty fertilizers in various grades, including agricultural products used in broadcast spreaders, direct application, and liquid fertilizer solutions; turf products used by the turf and ornamental markets, as well as for blends used on golf course greens; organic products under the Protassium+ brand; and micronutrient products under the Wolf Trax brand, as well as specialty plant nutrition solution-based products and chemical solutions. This segment provides its products to distributors and retailers of crop inputs, as well as growers. The Plant Nutrition South America segment offers various specialty plant nutrients and supplements; water and wastewater treatment chemicals for cleaning, decontaminating, and purifying water; and process chemicals for industrial use. The company was formerly known as Salt Holdings Corporation and changed its name to Compass Minerals International, Inc. in December 2003. Compass Minerals International, Inc. was founded in 1993 and is headquartered in Overland Park, Kansas.

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