Compass Minerals International (NYSE: CMP) and Agrium (NYSE:AGU) are both mid-cap basic materials companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, analyst recommendations, dividends, risk, institutional ownership, profitability and valuation.

Risk and Volatility

Compass Minerals International has a beta of 0.45, indicating that its share price is 55% less volatile than the S&P 500. Comparatively, Agrium has a beta of 0.62, indicating that its share price is 38% less volatile than the S&P 500.

Institutional & Insider Ownership

66.4% of Agrium shares are held by institutional investors. 0.8% of Compass Minerals International shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current recommendations for Compass Minerals International and Agrium, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Compass Minerals International 0 3 0 0 2.00
Agrium 1 7 7 0 2.40

Compass Minerals International presently has a consensus price target of $67.00, indicating a potential upside of 0.98%. Agrium has a consensus price target of $105.27, indicating a potential upside of 8.52%. Given Agrium’s stronger consensus rating and higher possible upside, analysts plainly believe Agrium is more favorable than Compass Minerals International.

Profitability

This table compares Compass Minerals International and Agrium’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Compass Minerals International 9.83% 10.01% 3.06%
Agrium 4.22% 9.69% 3.54%

Valuation & Earnings

This table compares Compass Minerals International and Agrium’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Compass Minerals International $1.24 billion 1.81 $248.20 million $3.58 18.53
Agrium $13.56 billion 0.99 $1.62 billion $4.15 23.38

Agrium has higher revenue and earnings than Compass Minerals International. Compass Minerals International is trading at a lower price-to-earnings ratio than Agrium, indicating that it is currently the more affordable of the two stocks.

Dividends

Compass Minerals International pays an annual dividend of $2.88 per share and has a dividend yield of 4.3%. Agrium pays an annual dividend of $3.50 per share and has a dividend yield of 3.6%. Compass Minerals International pays out 80.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Agrium pays out 84.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Compass Minerals International has increased its dividend for 5 consecutive years and Agrium has increased its dividend for 13 consecutive years. Compass Minerals International is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Agrium beats Compass Minerals International on 10 of the 17 factors compared between the two stocks.

Compass Minerals International Company Profile

Compass Minerals International, Inc. (CMI) is a provider of essential minerals that solve nature’s challenges, including salt for winter roadway safety and other consumer, industrial and agricultural uses; specialty plant nutrition minerals for the quality and yield of crops, and specialty chemicals for water treatment and other industrial processes. The Company has three segments: Salt, Plant Nutrition North America and Plant Nutrition South America. The Salt segment produces and markets salt and magnesium chloride for use in road deicing and dust control, food processing, water softeners, and agricultural and industrial applications. Its Plant Nutrition North America segment includes sales of sulfate of potash (SOP) specialty fertilizer and micronutrients. The Plant Nutrition South America segment operates two primary businesses in Brazil: agricultural productivity and chemical solutions.

Agrium Company Profile

Agrium Inc. is a retailer of agricultural products and services in the United States, Canada, Australia, Argentina, Brazil, Chile and Uruguay and a multi-national producer and wholesale marketer of nutrients for agricultural and industrial markets. The Company’s segments include Retail and Wholesale. As of December 31, 2016, its Retail business unit marketed crop nutrients, crop protection products, seed, merchandise, application and other agronomic services through 1,500 retail locations in the United States, Canada, Australia, Argentina, Brazil, Chile and Uruguay. Its Wholesale business unit manufactures, mines and markets a range of nutrients, including nitrogen-based, potash and phosphate-based crop nutrient products. As of December 31, 2016, its Wholesale business unit owned and operated five North American nitrogen facilities, four located in Alberta, Canada and one in Borger, Texas, United States.

Receive News & Stock Ratings for Compass Minerals International Inc. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Compass Minerals International Inc. and related stocks with our FREE daily email newsletter.