Innophos (NASDAQ:IPHS) and Gulf Resources (NASDAQ:GURE) are both small-cap basic materials companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, earnings, dividends, analyst recommendations and valuation.
Institutional and Insider Ownership
91.2% of Innophos shares are held by institutional investors. Comparatively, 7.0% of Gulf Resources shares are held by institutional investors. 2.5% of Innophos shares are held by insiders. Comparatively, 30.1% of Gulf Resources shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This table compares Innophos and Gulf Resources’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of current recommendations and price targets for Innophos and Gulf Resources, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Volatility and Risk
Innophos has a beta of 1.33, meaning that its share price is 33% more volatile than the S&P 500. Comparatively, Gulf Resources has a beta of 1.06, meaning that its share price is 6% more volatile than the S&P 500.
Valuation & Earnings
This table compares Innophos and Gulf Resources’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Innophos||$801.84 million||0.72||$36.07 million||$2.28||12.91|
|Gulf Resources||$2.60 million||21.47||-$69.96 million||N/A||N/A|
Innophos has higher revenue and earnings than Gulf Resources.
Innophos pays an annual dividend of $1.92 per share and has a dividend yield of 6.5%. Gulf Resources does not pay a dividend. Innophos pays out 84.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Innophos beats Gulf Resources on 9 of the 12 factors compared between the two stocks.
Innophos Company Profile
Innophos Holdings, Inc., together with its subsidiaries, produces specialty ingredients with applications in food, health, nutrition, and industrial markets. It operates through three segments: Food, Health and Nutrition; Industrial Specialties; and Other. The company's specialty ingredients include specialty phosphate salts and specialty phosphoric acids, as well as other mineral, enzyme, and botanical based specialty ingredients that are used as flavor enhancers in beverages; electrolytes in sports drinks; texture modifiers in cheeses; leavening agents in baked goods; calcium and phosphorus fortification in food and beverages; moisture and color retention in seafood, poultry, and meat; excipients in vitamins, minerals, nutritional supplements, and pharmaceuticals; and abrasives in toothpaste. It also provides food and technical grade purified phosphoric acid (PPA) used in the production of phosphate salts, as well as in food and beverages, and water treatment applications; technical grade sodium tripolyphosphate (STPP), a specialty phosphate, which is used as an ingredient in cleaning products, such as industrial and institutional cleaners, automatic dishwashing detergents, and consumer laundry detergents, as well as in water treatment, clay processing, and copper ore processing activities; and detergent grade PPA that is primarily used in the production of STPP. In addition, the company offers granular triple super-phosphate (GTSP), a fertilizer product line used for enhancing crop yields in various agricultural sectors; and merchant green phosphoric acid. It serves primarily consumer goods manufacturers, distributors, and specialty chemical manufacturers in the United States, Canada, Mexico, and internationally. Innophos Holdings, Inc. was founded in 2004 and is headquartered in Cranbury, New Jersey.
Gulf Resources Company Profile
Gulf Resources, Inc., through its subsidiaries, manufactures and trades in bromine, crude salt, chemical products, and natural gas in the People's Republic of China. It provides bromine for use in brominated flame retardants, fumigants, water purification compounds, dyes, medicines, and disinfectants. The company also offers crude salt for use as a material in alkali and chlorine alkali production; and for use in the chemical, food and beverage, and other industries. In addition, it manufactures and sells chemical products for use in oil and gas field exploration, oil and gas distribution, oil field drilling, papermaking chemical agents, inorganic chemicals, and materials that are used for human and animal antibiotics. Gulf Resources, Inc. is based in Shouguang, the People's Republic of China.
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