Quaker Chemical Corporation (NYSE: KWR) and Braskem (NYSE:BAK) are both basic materials companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, dividends, earnings and risk.
Analyst Recommendations
This is a breakdown of recent ratings and recommmendations for Quaker Chemical Corporation and Braskem, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Quaker Chemical Corporation | 0 | 1 | 0 | 0 | 2.00 |
| Braskem | 0 | 0 | 3 | 0 | 3.00 |
Quaker Chemical Corporation currently has a consensus target price of $153.00, indicating a potential upside of 15.82%. Braskem has a consensus target price of $20.00, indicating a potential downside of 15.07%. Given Quaker Chemical Corporation’s higher probable upside, equities analysts clearly believe Quaker Chemical Corporation is more favorable than Braskem.
Earnings and Valuation
This table compares Quaker Chemical Corporation and Braskem’s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| Quaker Chemical Corporation | $777.77 million | 2.26 | $106.55 million | $3.93 | 33.61 |
| Braskem | $15.36 billion | 0.61 | $3.75 billion | $2.55 | 9.24 |
Braskem has higher revenue and earnings than Quaker Chemical Corporation. Braskem is trading at a lower price-to-earnings ratio than Quaker Chemical Corporation, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Quaker Chemical Corporation and Braskem’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Quaker Chemical Corporation | 6.73% | 15.52% | 9.26% |
| Braskem | 3.30% | 38.15% | 2.99% |
Volatility & Risk
Quaker Chemical Corporation has a beta of 1.22, indicating that its stock price is 22% more volatile than the S&P 500. Comparatively, Braskem has a beta of 1.14, indicating that its stock price is 14% more volatile than the S&P 500.
Dividends
Quaker Chemical Corporation pays an annual dividend of $1.42 per share and has a dividend yield of 1.1%. Braskem pays an annual dividend of $0.77 per share and has a dividend yield of 3.3%. Quaker Chemical Corporation pays out 36.1% of its earnings in the form of a dividend. Braskem pays out 30.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Quaker Chemical Corporation has increased its dividend for 7 consecutive years. Braskem is clearly the better dividend stock, given its higher yield and lower payout ratio.
Insider and Institutional Ownership
82.6% of Quaker Chemical Corporation shares are held by institutional investors. Comparatively, 0.8% of Braskem shares are held by institutional investors. 3.6% of Quaker Chemical Corporation shares are held by company insiders. Comparatively, 0.0% of Braskem shares are held by company 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.
Summary
Quaker Chemical Corporation beats Braskem on 10 of the 17 factors compared between the two stocks.
About Quaker Chemical Corporation
Quaker Chemical Corporation is a provider of process fluids, chemical specialties, and technical expertise to a range of industries, including steel, aluminum, mining, aerospace, tube and pipe, cans and others. The Company’s segments include North America, Europe, Middle East and Africa (EMEA), Asia/Pacific and South America. It develops, produces, and markets a range of formulated chemical specialty products and offers chemical management services. Its products and services include rolling lubricants (used by manufacturers of steel in the hot and cold rolling of steel and by manufacturers of aluminum in the hot rolling of aluminum); machining and grinding compounds (used by metalworking customers in cutting, shaping, and grinding metal parts, which require special treatment to enable them to tolerate the manufacturing process, achieve closer tolerance, and improve tool life), and hydraulic fluids (used by steel, metalworking, and other customers to operate hydraulic equipment).
About Braskem
Braskem S.A. produces thermoplastic resins. The Company’s segments are Basic petrochemicals, Polyolefins, Vinyls, the United States and Europe, and Chemical distribution. It is also engaged in the import and export of chemicals, petrochemicals and fuels, the production, supply and sale of utilities such as steam, water, compressed air, industrial gases, the provision of industrial services, and the production, supply and sale of electric energy. It also invests in other companies, either as a partner or as shareholder. It operates over 40 industrial units, over 30 of which are located in the Brazilian states of Alagoas, Bahia, Rio de Janeiro, Rio Grande do Sul and Sao Paulo; over five are located in the United States, in the states of Pennsylvania, Texas and West Virginia, and over two are located in Germany, in the cities of Wesseling and Schkopau. These units produce thermoplastic resins–polyethylene, polypropylene and polyvinyl chloride, as well as basic petrochemicals.
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