Innospec (NASDAQ: IOSP) and GCP Applied Technologies (NYSE:GCP) are both basic materials companies, but which is the superior stock? We will contrast the two companies based on the strength of their earnings, profitability, analyst recommendations, dividends, institutional ownership, valuation and risk.
Institutional & Insider Ownership
91.7% of Innospec shares are held by institutional investors. Comparatively, 83.5% of GCP Applied Technologies shares are held by institutional investors. 2.0% of Innospec shares are held by insiders. Comparatively, 0.7% of GCP Applied Technologies shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
This table compares Innospec and GCP Applied Technologies’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|GCP Applied Technologies||50.82%||14.19%||3.26%|
Risk and Volatility
Innospec has a beta of 1.06, indicating that its share price is 6% more volatile than the S&P 500. Comparatively, GCP Applied Technologies has a beta of 1.39, indicating that its share price is 39% more volatile than the S&P 500.
Earnings and Valuation
This table compares Innospec and GCP Applied Technologies’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Innospec||$1.31 billion||1.43||$61.80 million||$4.66||16.43|
|GCP Applied Technologies||$1.08 billion||1.92||$553.40 million||$0.64||45.23|
GCP Applied Technologies has lower revenue, but higher earnings than Innospec. Innospec is trading at a lower price-to-earnings ratio than GCP Applied Technologies, indicating that it is currently the more affordable of the two stocks.
Innospec pays an annual dividend of $1.76 per share and has a dividend yield of 2.3%. GCP Applied Technologies does not pay a dividend. Innospec pays out 37.8% of its earnings in the form of a dividend.
This is a breakdown of recent recommendations for Innospec and GCP Applied Technologies, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|GCP Applied Technologies||0||1||1||0||2.50|
Innospec presently has a consensus price target of $65.00, suggesting a potential downside of 15.09%. GCP Applied Technologies has a consensus price target of $33.00, suggesting a potential upside of 13.99%. Given GCP Applied Technologies’ higher possible upside, analysts clearly believe GCP Applied Technologies is more favorable than Innospec.
Innospec beats GCP Applied Technologies on 9 of the 16 factors compared between the two stocks.
Innospec Inc. develops, manufactures, blends, markets, and supplies specialty chemicals for use as fuel additives, ingredients for personal care, home care, agrochemical, mining and other applications, and oilfield chemicals worldwide. It operates through four segments: Fuel Specialties, Performance Chemicals, Oilfield Services, and Octane Additives. The Fuel Specialties segment offers a range of specialty chemical products used as additives in various fuels. This segment's products are used in the operation of automotive, marine, and aviation engines; power station generators; and heating oil. The Performance Chemicals segment provides technology-based solutions for its customers' processes or products focused in the personal care, home care, agrochemical, and mining markets. The Oilfield Services segment develops and markets products to prevent loss of mud in drilling operations; chemical solutions for fracturing, stimulation, and completion operations; and products for oil and gas production, which enable flow assurance and asset integrity. The Octane Additives segment produces and sells tetra ethyl lead (TEL) for use in automotive gasoline. This segment is also involved in an environmental remediation business that manages the cleanup of redundant TEL plants. The company serves oil and gas exploration and production companies, oil refineries, fuel manufacturers and users, formulators of personal care and home care, agrochemical and mining formulations, and other chemical and industrial companies. The company was formerly known as Octel Corp. and changed its name to Innospec Inc. in January 2006. Innospec Inc. was founded in 1938 and is headquartered in Englewood, Colorado.
About GCP Applied Technologies
GCP Applied Technologies Inc. produces and sells specialty construction chemicals and specialty building materials worldwide. Its Specialty Construction Chemicals segment offers concrete admixtures under the CONCERA, CLARENA, ADVA, STRUX, MIRA, TYTRO, POLARSET, ECLIPSE, DARACEM, DARASET, DCI, RECOVER, WRDA, and ZYLA brands; admixtures for decorative concrete under the PIERI brand; concrete production management system under the VERIFI and DUCTILCRETE brands; and cement additives under the OPTEVA HE, TAVERO VM, CBA, SYNCHRO, HEA2, TDA, and ESE brands. The company's Specialty Building Materials segment provides building envelope products to protect structures from water, and manages air and vapor transmission through building walls under the BITUTHENE, PREPRUFE, ADPRUFE, HYDRODUCT, ADCOR, SILCOR, PERM-A-BARRIER, ELIMINATOR, and INTEGRITANK brands; and residential building products comprising specialty roofing membranes and flexible flashings under the ICE & WATER SHIELD, TRI-FLEX, and VYCOR brands. This segment also offers fire protection products under the MONOKOTE brand; chemical grouts repair and remediation in waterproofing applications and soil stabilization under the DE NEEF, HYDRO ACTIVE, SWELLSEAL, and DE NEEF PURe brands for repair and remediation in waterproofing applications and soil stabilization; cementitious grouts and mortars for under filling and gap filling purposes under the BETEC brand; and specialty flooring products under the KOVARA and ORCON brands. The company was incorporated in 2015 and is headquartered in Cambridge, Massachusetts.
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