Celanese Corporation (NYSE: CE) and UFP Technologies (NASDAQ:UFPT) are both basic materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, institutional ownership, valuation, profitability, earnings, analyst recommendations and dividends.

Profitability

This table compares Celanese Corporation and UFP Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Celanese Corporation 13.66% 31.98% 11.39%
UFP Technologies 5.43% 6.90% 6.09%

Insider & Institutional Ownership

98.5% of Celanese Corporation shares are held by institutional investors. Comparatively, 68.2% of UFP Technologies shares are held by institutional investors. 0.4% of Celanese Corporation shares are held by company insiders. Comparatively, 13.3% of UFP Technologies 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.

Analyst Recommendations

This is a summary of current ratings and price targets for Celanese Corporation and UFP Technologies, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Celanese Corporation 1 4 8 1 2.64
UFP Technologies 0 0 0 0 N/A

Celanese Corporation presently has a consensus target price of $107.85, suggesting a potential upside of 2.78%. Given Celanese Corporation’s higher probable upside, analysts clearly believe Celanese Corporation is more favorable than UFP Technologies.

Valuation and Earnings

This table compares Celanese Corporation and UFP Technologies’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Celanese Corporation $5.39 billion 2.64 $900.00 million $5.73 18.31
UFP Technologies $146.13 million 1.33 $7.97 million $1.09 24.50

Celanese Corporation has higher revenue and earnings than UFP Technologies. Celanese Corporation is trading at a lower price-to-earnings ratio than UFP Technologies, indicating that it is currently the more affordable of the two stocks.

Dividends

Celanese Corporation pays an annual dividend of $1.84 per share and has a dividend yield of 1.8%. UFP Technologies does not pay a dividend. Celanese Corporation pays out 32.1% of its earnings in the form of a dividend. UFP Technologies has increased its dividend for 5 consecutive years.

Risk and Volatility

Celanese Corporation has a beta of 1.31, meaning that its stock price is 31% more volatile than the S&P 500. Comparatively, UFP Technologies has a beta of 0.18, meaning that its stock price is 82% less volatile than the S&P 500.

Summary

Celanese Corporation beats UFP Technologies on 13 of the 17 factors compared between the two stocks.

Celanese Corporation Company Profile

Celanese Corporation (Celanese) is a technology and specialty materials company. The Company’s segments include Advanced Engineered Materials, Consumer Specialties, Industrial Specialties, Acetyl Intermediates and Other Activities. The Advanced Engineered Materials segment includes the Company’s engineered materials business and certain affiliates. The Consumer Specialties segment includes the Company’s cellulose derivatives and food ingredients businesses, which serve consumer-driven applications. The Industrial Specialties segment includes the Company’s emulsion polymers and ethylene vinyl acetate (EVA) polymers businesses. The Acetyl Intermediates segment includes the Company’s intermediate chemistry business, which produces and supplies acetyl products, including acetic acid, vinyl acetate monomer (VAM), acetic anhydride and acetate esters. The Company has operations in North America, Europe and Asia. As of December 31, 2016, the Company had 30 global production facilities.

UFP Technologies Company Profile

UFP Technologies, Inc. is a designer and custom converter of foams, plastics, composites and natural fiber materials. The Company is engaged in providing solutions to customers primarily within the medical, automotive, consumer, electronics, industrial, and aerospace and defense markets. It converts these materials using laminating, molding, and fabricating manufacturing technologies. The Company’s raw materials consist of polyethylene and polyurethane foams, sheet plastics, pulp fiber, cross-linked polyethylene and reticulated polyurethane foams, fabric and foam laminates, and natural fiber materials. The Company converts these materials to provide customers various solutions, including automotive interior trim, medical device components, disposable wound care components, military uniform and gear components, athletic padding, air filtration, high-temperature insulation, abrasive nail files and other beauty aids, and cushion packaging for their products.

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