Analyzing Ingevity (NYSE:NGVT) & Element Solutions (NYSE:ESI)

Ingevity (NYSE:NGVT) and Element Solutions (NYSE:ESI) are both mid-cap materials companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, valuation, dividends, earnings, institutional ownership, analyst recommendations and risk.

Valuation and Earnings

This table compares Ingevity and Element Solutions”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ingevity	$1.17 billion	1.77	-$167.10 million	$1.47	40.85
Element Solutions	$2.55 billion	2.97	$190.80 million	$0.85	36.80

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

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Ingevity and Element Solutions, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ingevity	0	3	2	0	2.40
Element Solutions	0	2	7	4	3.15

Ingevity currently has a consensus price target of $80.00, suggesting a potential upside of 33.21%. Element Solutions has a consensus price target of $46.36, suggesting a potential upside of 48.22%. Given Element Solutions’ stronger consensus rating and higher possible upside, analysts plainly believe Element Solutions is more favorable than Ingevity.

Risk & Volatility

Ingevity has a beta of 1.12, meaning that its stock price is 12% more volatile than the S&P 500. Comparatively, Element Solutions has a beta of 1.29, meaning that its stock price is 29% more volatile than the S&P 500.

Profitability

This table compares Ingevity and Element Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ingevity	5.28%	469.87%	11.22%
Element Solutions	5.87%	15.45%	7.67%

Institutional and Insider Ownership

91.6% of Ingevity shares are owned by institutional investors. Comparatively, 92.3% of Element Solutions shares are owned by institutional investors. 0.9% of Ingevity shares are owned by insiders. Comparatively, 6.2% of Element Solutions shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Element Solutions beats Ingevity on 12 of the 15 factors compared between the two stocks.

About Ingevity

Ingevity Corporation manufactures and sells activated carbon products, derivative specialty chemicals, and engineered polymers in North America, the Asia Pacific, Europe, the Middle East, Africa, and South America. It operates through three segments: Performance Materials, Performance Chemicals, and Advanced Polymer Technologies. The Performance Materials segment engineers, manufactures, and sells hardwood-based and chemically activated carbon products for use in gasoline vapor emission control systems in cars, motorcycles, trucks, and boats. This segment also produces other activated carbon products for food, water, beverage, and chemical purification applications. The Performance Chemicals segment consists of road technologies and industrial specialties. This segment's products are used in pavement construction, pavement preservation, pavement reconstruction and recycling, road markings, agrochemical dispersants, paper chemicals, and other industrial uses. The Advanced Polymer Technologies segment produces caprolactone and caprolactone-based specialty polymers for use in coatings, resins, elastomers, adhesives, bioplastics, and medical devices. It serves automotive parts and components manufacturers through sales representatives and distributors. The company was formerly known as WestRock Company, Specialty Chemicals Business and changed its name to Ingevity Corporation in September 2015. Ingevity Corporation was founded in 1964 and is headquartered in North Charleston, South Carolina.

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.