Element Solutions (NYSE:ESI – Get Free Report) and Flotek Industries (NYSE:FTK – Get Free Report) are both materials companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, profitability, risk, institutional ownership, earnings, dividends and analyst recommendations.
Analyst Recommendations
This is a summary of current ratings and target prices for Element Solutions and Flotek Industries, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Element Solutions | 0 | 2 | 7 | 3 | 3.08 |
| Flotek Industries | 0 | 0 | 4 | 1 | 3.20 |
Element Solutions presently has a consensus target price of $46.36, suggesting a potential upside of 29.64%. Flotek Industries has a consensus target price of $34.67, suggesting a potential upside of 32.80%. Given Flotek Industries’ stronger consensus rating and higher probable upside, analysts clearly believe Flotek Industries is more favorable than Element Solutions.
Insider and Institutional Ownership
92.3% of Element Solutions shares are owned by institutional investors. Comparatively, 10.9% of Flotek Industries shares are owned by institutional investors. 6.2% of Element Solutions shares are owned by insiders. Comparatively, 2.4% of Flotek Industries shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Valuation and Earnings
This table compares Element Solutions and Flotek Industries”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Element Solutions | $2.55 billion | 3.40 | $190.80 million | $0.85 | 42.08 |
| Flotek Industries | $292.97 million | 3.23 | $30.53 million | $0.99 | 26.37 |
Element Solutions has higher revenue and earnings than Flotek Industries. Flotek Industries is trading at a lower price-to-earnings ratio than Element Solutions, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Element Solutions has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500. Comparatively, Flotek Industries has a beta of 1.42, meaning that its share price is 42% more volatile than the S&P 500.
Profitability
This table compares Element Solutions and Flotek Industries’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Element Solutions | 5.87% | 15.45% | 7.67% |
| Flotek Industries | 12.97% | 21.57% | 10.89% |
Summary
Element Solutions beats Flotek Industries on 8 of the 15 factors compared between the two stocks.
About Element Solutions
Element Solutions Inc operates as a specialty chemicals company in the United States, China, and internationally. The company operates in two segments, Electronics, and Industrial & Specialty. The Electronics segment researches, formulates, and sells specialty chemicals and materials for various types of electronics hardware products. This segment also supplies surface mount technologies, fluxes, thermal management material, coatings, and other attachment materials; chemical formulations to the electronics industry; and advanced copper interconnects, die attachment, sintered silver material, adhesives, wafer bump processes, and photomask technologies for semiconductor industry. It primarily serves mobile communications, computers, automobiles, and aerospace equipment industries. The Industrial & Specialty segment provides industrial solutions, which include chemical systems that protect and decorate metal and plastic surfaces; consumable chemicals that enable printing image transfer on flexible packaging materials; and chemistries used in water-based hydraulic control fluids for offshore energy production applications. It serves aerospace, automotive, construction, consumer electronics, consumer packaged goods, and oil and gas production end markets. The company was formerly known as Platform Specialty Products Corporation and changed its name to Element Solutions Inc in January 2019. Element Solutions Inc was founded in 1785 and is headquartered in Fort Lauderdale, Florida.
About Flotek Industries
Flotek Industries, Inc. operates as a technology-driven green chemistry and data company that serves customers across industrial and commercial markets in the United States, the United Arab Emirates, and internationally. It operates through two segments: Chemistry Technologies (CT) and Data Analytics (DA). The CT segment designs, develops, manufactures, packages, distributes, delivers, and markets green specialty chemicals that enhance the profitability of hydrocarbon producers, as well as green specialty chemistries, and logistics and technology services. This segment primarily serves integrated oil and gas, oilfield services, independent oil and gas, national and state-owned oil, geothermal energy, solar energy, and alternative energy companies. The DA segment designs, develops, produces, sells, and supports equipment and services that create and provide valuable information on the composition and properties of energy customers' hydrocarbon fluids. It sells its products directly through a mix of in-house sales professionals, as well as contractual agency agreements. Flotek Industries, Inc. was incorporated in 1985 and is headquartered in Houston, Texas.
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