NewMarket (NYSE: NEU) and FutureFuel (NYSE:FF) are both basic materials companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, valuation, dividends, institutional ownership, earnings, risk and analyst recommendations.
This table compares NewMarket and FutureFuel’s 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 NewMarket and FutureFuel, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Volatility and Risk
NewMarket has a beta of 0.74, indicating that its share price is 26% less volatile than the S&P 500. Comparatively, FutureFuel has a beta of 1.68, indicating that its share price is 68% more volatile than the S&P 500.
Institutional and Insider Ownership
55.7% of NewMarket shares are owned by institutional investors. Comparatively, 44.2% of FutureFuel shares are owned by institutional investors. 16.9% of NewMarket shares are owned by company insiders. Comparatively, 43.3% of FutureFuel shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Earnings and Valuation
This table compares NewMarket and FutureFuel’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|NewMarket||$2.20 billion||2.15||$190.50 million||N/A||N/A|
|FutureFuel||$275.03 million||1.93||$23.51 million||N/A||N/A|
NewMarket has higher revenue and earnings than FutureFuel.
NewMarket pays an annual dividend of $7.00 per share and has a dividend yield of 1.7%. FutureFuel pays an annual dividend of $0.24 per share and has a dividend yield of 2.0%. NewMarket has increased its dividend for 9 consecutive years.
NewMarket beats FutureFuel on 8 of the 12 factors compared between the two stocks.
NewMarket Corporation, through its subsidiaries, engages in the petroleum additives businesses. It offers lubricant additives for use in various vehicle and industrial applications, such as engine oils, transmission fluids, off-road powertrain and hydraulic systems, gear oils, hydraulic oils, turbine oils, metalworking fluids, and in other applications where metal-to-metal moving parts are utilized; and engine oil, driveline, and industrial additives. The company also provides fuel additives that are used to enhance the oil refining process and the performance of gasoline, diesel, biofuels, and other fuels to industry, government, original equipment manufacturers (OEMs), and individual customers. It has operations in the United States, Canada, Europe, the Asia Pacific, India, Latin America, and the Middle East. NewMarket Corporation was founded in 1887 and is headquartered in Richmond, Virginia.
FutureFuel Corp. is the holding company of FutureFuel Chemical Company. FutureFuel Chemical Company manufactures diversified chemical products, bio-based products consisting of biofuels, and bio-based specialty chemical products. FutureFuel Chemical Company conducts its operations through two segments: chemicals and biofuels. The chemicals segment manufactures a diversified listing of chemical products that are sold to third-party customers. The biofuels segment primarily produces and sells biodiesel and petrodiesel blends to its customers. The biofuels segment also involves the buying, selling and shipping of refined petroleum products on common carrier pipelines. Custom chemicals manufacturing involves producing various products for strategic customers, generally under long-term contracts. Its products also include a family of acetal-based solvents, including diethoxymethane, dimethoxymethane, dibutoxymethane, glycerol formal and phenol sulfonic acid.
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