Comparing American Vanguard (AVD) and Terra Nitrogen (TNH)

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American Vanguard (NYSE: AVD) and Terra Nitrogen (NYSE:TNH) are both small-cap basic materials companies, but which is the better business? We will contrast the two companies based on the strength of their risk, institutional ownership, earnings, dividends, valuation, analyst recommendations and profitability.

Valuation & Earnings

This table compares American Vanguard and Terra Nitrogen’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
American Vanguard $355.05 million 1.88 $20.27 million $0.57 39.21
Terra Nitrogen $397.20 million 3.91 $153.90 million N/A N/A

Terra Nitrogen has higher revenue and earnings than American Vanguard.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for American Vanguard and Terra Nitrogen, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
American Vanguard 0 1 1 0 2.50
Terra Nitrogen 0 0 0 0 N/A

American Vanguard presently has a consensus target price of $25.50, suggesting a potential upside of 14.09%. Given American Vanguard’s higher probable upside, research analysts plainly believe American Vanguard is more favorable than Terra Nitrogen.

Profitability

This table compares American Vanguard and Terra Nitrogen’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
American Vanguard 5.52% 6.01% 3.63%
Terra Nitrogen 38.75% 41.57% 38.41%

Institutional & Insider Ownership

77.2% of American Vanguard shares are held by institutional investors. Comparatively, 3.5% of Terra Nitrogen shares are held by institutional investors. 5.2% of American Vanguard shares are held by insiders. Comparatively, 2.0% of Terra Nitrogen shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Volatility and Risk

American Vanguard has a beta of 1.18, suggesting that its stock price is 18% more volatile than the S&P 500. Comparatively, Terra Nitrogen has a beta of -0.03, suggesting that its stock price is 103% less volatile than the S&P 500.

Dividends

American Vanguard pays an annual dividend of $0.08 per share and has a dividend yield of 0.4%. Terra Nitrogen pays an annual dividend of $8.12 per share and has a dividend yield of 9.7%. American Vanguard pays out 14.0% of its earnings in the form of a dividend.

Summary

Terra Nitrogen beats American Vanguard on 8 of the 14 factors compared between the two stocks.

American Vanguard Company Profile

American Vanguard Corporation, through its subsidiaries, develops, manufactures, and markets specialty chemicals for agricultural, commercial, and consumer uses in the United States and internationally. The company manufactures and formulates chemicals, including insecticides, fungicides, herbicides, molluscicides, growth regulators, and soil fumigants in liquid, powder, and granular forms for crops, turf and ornamental plants, and human and animal health protection. It also markets and distributes end-use chemical and biological products for crop applications; and distributes technology based pesticide solutions for greenhouse and nursery production applications, as well as offers formulations, such as PCNB, chlorothalonil, and propiconazole. The company distributes its products through national distribution companies and buying groups or co-operatives; and through sales offices and sales force executives. American Vanguard Corporation was founded in 1969 and is headquartered in Newport Beach, California.

Terra Nitrogen Company Profile

Terra Nitrogen Company, L.P. (TNCLP) is a limited partnership that produces nitrogen fertilizer products. The Company’s principal products are anhydrous ammonia (ammonia) and urea ammonium nitrate solutions (UAN), which it manufactures at its facility in Verdigris, Oklahoma. Its nitrogen products are used primarily by farmers. For the year ended December 31, 2016, it had sold 2.2 million tons of nitrogen fertilizers. The Company has production facility, in Verdigris, Oklahoma. As of December 31, 2016, it had two ammonia plants, two nitric acid plants and two UAN plants. The Company conducts its operations through an operating partnership, Terra Nitrogen, Limited Partnership (TNLP). Terra Nitrogen GP Inc. is the general partner of both TNCLP and TNLP and owns a 0.025% general partner interest in each of TNCLP and TNLP. The General Partner is an indirect subsidiary of CF Industries Holdings, Inc., which is engaged in the manufacturing and distribution of nitrogen products.

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