Intrepid Potash (NYSE: IPI) and CVR Partners (NYSE:UAN) 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 dividends, analyst recommendations, earnings, risk, institutional ownership, valuation and profitability.
This table compares Intrepid Potash and CVR Partners’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a breakdown of current recommendations for Intrepid Potash and CVR Partners, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Intrepid Potash presently has a consensus target price of $3.92, indicating a potential upside of 3.34%. CVR Partners has a consensus target price of $5.00, indicating a potential upside of 44.51%. Given CVR Partners’ stronger consensus rating and higher possible upside, analysts clearly believe CVR Partners is more favorable than Intrepid Potash.
Institutional and Insider Ownership
46.9% of Intrepid Potash shares are held by institutional investors. Comparatively, 31.0% of CVR Partners shares are held by institutional investors. 27.3% of Intrepid Potash shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Risk & Volatility
Intrepid Potash has a beta of 0.95, indicating that its stock price is 5% less volatile than the S&P 500. Comparatively, CVR Partners has a beta of 1.25, indicating that its stock price is 25% more volatile than the S&P 500.
Earnings & Valuation
This table compares Intrepid Potash and CVR Partners’ gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Intrepid Potash||$157.61 million||3.14||-$22.91 million||($0.25)||-15.16|
|CVR Partners||$330.80 million||1.18||-$72.78 million||($0.64)||-5.41|
Intrepid Potash has higher earnings, but lower revenue than CVR Partners. Intrepid Potash is trading at a lower price-to-earnings ratio than CVR Partners, indicating that it is currently the more affordable of the two stocks.
CVR Partners pays an annual dividend of $0.02 per share and has a dividend yield of 0.6%. Intrepid Potash does not pay a dividend. CVR Partners pays out -3.1% of its earnings in the form of a dividend.
About Intrepid Potash
Intrepid Potash, Inc. is a producer of muriate of potash (potassium chloride or potash) and langbeinite (sulfate of potash magnesia) in the United States, which it markets and sells as Trio. The Company operates in the extraction, production and sale of potassium-related products. Its products are potash and Trio. It sells potash into three markets, including the agricultural market as a fertilizer input; the industrial market as a component in drilling and fracturing fluids for oil and gas wells and an input to other industrial processes, and the animal feed market as a nutrient supplement. Trio, which it mines from langbeinite ore, is its specialty fertilizer that delivers potassium, sulfate and magnesium in a single particle and has low chloride. The Company also produces salt, magnesium chloride, metal recovery salts and brine containing salt and potassium from its mining processes. It produces potash from three solar evaporation solution mining facilities.
About CVR Partners
CVR Partners, LP is a limited partnership formed by CVR Energy, Inc. (CVR Energy) to own, operate and grow its nitrogen fertilizer business. The Company produces and distributes nitrogen fertilizer products, which are used by farmers to manage the yield and quality of their crops. As of December 31, 2016, the Company produced its nitrogen fertilizer products at two manufacturing facilities, located in Coffeyville, Kansas and East Dubuque, Illinois. As of December 31, 2016, the Company’s Coffeyville Facility included a 1,300 ton-per-day capacity ammonia unit, a 3,000 ton-per-day capacity urea-ammonium nitrate (UAN) unit, and a gasifier complex having a capacity of 89 million standard cubic feet per day of hydrogen. The gasifier is a dual-train facility, with each gasifier able to function independently of the other. The Coffeyville Facility utilizes a petroleum coke, or pet coke, gasification process to produce nitrogen fertilizer.
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