Sensient Technologies (NYSE: SXT) and Chemtura (NYSE:CHMT) are both basic materials companies, but which is the superior business? We will compare the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, earnings, institutional ownership and dividends.

Profitability

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

Net Margins Return on Equity Return on Assets
Sensient Technologies 7.89% 17.34% 8.85%
Chemtura 5.71% 9.00% 4.02%

Earnings and Valuation

This table compares Sensient Technologies and Chemtura’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Sensient Technologies $1.38 billion 2.43 $126.25 million $2.42 31.90
Chemtura N/A N/A N/A ($0.19) N/A

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

Dividends

Sensient Technologies pays an annual dividend of $1.32 per share and has a dividend yield of 1.7%. Chemtura does not pay a dividend. Sensient Technologies pays out 54.5% of its earnings in the form of a dividend. Chemtura has increased its dividend for 5 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Sensient Technologies and Chemtura, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Sensient Technologies 0 0 2 0 3.00
Chemtura 0 0 0 0 N/A

Sensient Technologies currently has a consensus price target of $89.15, suggesting a potential upside of 15.49%.

Institutional & Insider Ownership

90.1% of Sensient Technologies shares are owned by institutional investors. Comparatively, 93.1% of Chemtura shares are owned by institutional investors. 1.0% of Sensient Technologies shares are owned by insiders. Comparatively, 2.6% of Chemtura 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

Sensient Technologies beats Chemtura on 7 of the 11 factors compared between the two stocks.

About Sensient Technologies

Sensient Technologies Corporation is a manufacturer and marketer of colors, flavors and fragrances. The Company uses technologies at facilities around the world to develop specialty food and beverage systems, cosmetic and pharmaceutical systems, specialty inks and colors, and other specialty and fine chemicals. The Company’s three segments include the Flavors & Fragrances Group and the Color Group, which are managed on a product-and-services basis, and the Asia Pacific Group, which is managed on a geographic basis. The Company’s principal products include flavors, flavor enhancers and bionutrients; fragrances, aroma chemicals and essential oils; natural ingredients, including dehydrated vegetables and other food ingredients; natural and synthetic food and beverage colors; cosmetic colors and ingredients and pharmaceutical excipients and ingredients, and technical colors, specialty inks and colors, and specialty dyes and pigments.

About Chemtura

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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