Head to Head Contrast: Arkema (OTCMKTS:ARKAY) versus Albemarle (NYSE:ALB)

Arkema (OTCMKTS:ARKAY) and Albemarle (NYSE:ALB) are both basic materials companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, institutional ownership, profitability and dividends.

Valuation & Earnings

This table compares Arkema and Albemarle”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Arkema	$10.26 billion	0.47	$71.28 million	$0.25	254.90
Albemarle	$5.14 billion	3.07	-$510.63 million	($3.41)	-39.21

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

Volatility and Risk

Arkema has a beta of 0.84, indicating that its stock price is 16% less volatile than the S&P 500. Comparatively, Albemarle has a beta of 1.3, indicating that its stock price is 30% more volatile than the S&P 500.

Profitability

This table compares Arkema and Albemarle’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Arkema	0.46%	4.06%	2.08%
Albemarle	-5.00%	5.22%	2.51%

Analyst Ratings

This is a summary of current ratings and recommmendations for Arkema and Albemarle, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Arkema	2	5	1	0	1.88
Albemarle	1	10	15	1	2.59

Albemarle has a consensus target price of $202.54, suggesting a potential upside of 51.50%. Given Albemarle’s stronger consensus rating and higher possible upside, analysts clearly believe Albemarle is more favorable than Arkema.

Dividends

Arkema pays an annual dividend of $3.12 per share and has a dividend yield of 4.9%. Albemarle pays an annual dividend of $1.62 per share and has a dividend yield of 1.2%. Arkema pays out 1,248.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Albemarle pays out -47.5% of its earnings in the form of a dividend. Albemarle has increased its dividend for 30 consecutive years.

Insider & Institutional Ownership

92.9% of Albemarle shares are owned by institutional investors. 0.4% of Albemarle shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Albemarle beats Arkema on 12 of the 18 factors compared between the two stocks.

About Arkema

Arkema S.A. manufactures and sells specialty chemicals and advanced materials worldwide. The company operates in three segments: Adhesive Solutions, Advanced Materials and Coating Solutions, and Intermediates. The Adhesive Solutions segment provides solutions for construction, renovation of buildings, DIY, durable goods, and packaging and non-woven applications; and supplies technologies used in building activities for businesses and individuals, including sealants, tiles, flooring adhesives and waterproofing systems, and technologies used in industry, which include automotive, textiles, glazing, flexible and rigid packaging, and hygiene markets. This segment also offers performance polymers, such as specialty polyamides, PVDF, polyimides, fluorospecialties, and polyetherketoneketone; and performance additives which includes molecular sieves, organic peroxides, thiochemicals, and hydrogen peroxide. The Advance Materials and Coating Solutions segment offers coating solutions, including comprising EU/US acrylics and coating resins; coating additives, such as sartomer photocure resins and coatex rheology additives. This segment also provides decorative paints, industrial coatings, and adhesives; and solutions for applications in the paper, superabsorbent, water treatment and oil and gas extraction, and 3D printing and electronics industries. The Intermediates segment provides fluorogases and acrylics; and industrial intermediate chemicals used in construction, refrigeration and air conditioning, automotive, coatings, and water treatment sectors. Arkema S.A. was incorporated in 2003 and is headquartered in Colombes, France.

About Albemarle

Albemarle Corporation develops, manufactures, and markets engineered specialty chemicals worldwide. It operates through three segments: Energy Storage, Specialties and Ketjen. The Energy Storage segment offers lithium compounds, including lithium carbonate, lithium hydroxide, and lithium chloride; technical services for the handling and use of reactive lithium products; and lithium-containing by-products recycling services. The Specialties segment provides bromine-based specialty chemicals, including elemental bromine, alkyl and inorganic bromides, brominated powdered activated carbon, and other bromine fine chemicals; lithium specialties, such as butyllithium and lithium aluminum hydride; develops and manufactures cesium products for the chemical and pharmaceutical industries; and zirconium, barium, and titanium products for pyrotechnical applications that include airbag initiators. The Ketjen segment offers clean fuels technologies (CFT), which is composed of hydroprocessing catalysts (HPC) together with isomerization and akylation catalysts; fluidized catalytic cracking (FCC) catalysts and additives; and performance catalyst solutions (PCS), which is composed of organometallics and curatives. The company serves the energy storage, petroleum refining, consumer electronics, construction, automotive, lubricants, pharmaceuticals, and crop protection markets. Albemarle Corporation was founded in 1887 and is headquartered in Charlotte, North Carolina.