Innospec (NASDAQ: IOSP) and Sigma-Aldrich Corporation (NASDAQ:SIAL) are both basic materials companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, earnings, valuation, analyst recommendations, profitability, institutional ownership and risk.

Analyst Ratings

This is a breakdown of current ratings and price targets for Innospec and Sigma-Aldrich Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Innospec 0 1 1 0 2.50
Sigma-Aldrich Corporation 0 0 0 0 N/A

Innospec currently has a consensus target price of $65.00, indicating a potential downside of 3.35%.

Earnings & Valuation

This table compares Innospec and Sigma-Aldrich Corporation’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Innospec $883.40 million 1.84 $81.30 million $3.61 18.63
Sigma-Aldrich Corporation N/A N/A N/A $4.08 N/A

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

Profitability

This table compares Innospec and Sigma-Aldrich Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Innospec 7.45% 15.05% 8.38%
Sigma-Aldrich Corporation 16.22% 13.72% 10.47%

Institutional & Insider Ownership

88.8% of Innospec shares are owned by institutional investors. 2.0% of Innospec 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.

Dividends

Innospec pays an annual dividend of $0.76 per share and has a dividend yield of 1.1%. Sigma-Aldrich Corporation does not pay a dividend. Innospec pays out 21.1% of its earnings in the form of a dividend. Innospec has raised its dividend for 41 consecutive years.

Summary

Innospec beats Sigma-Aldrich Corporation on 7 of the 11 factors compared between the two stocks.

About Innospec

Innospec Inc. is a specialty chemicals company engaged in developing, manufacturing, blending, marketing and supplying of specialty chemicals for use as fuel additives and ingredients for personal care, home care, agrochemical, mining and other applications and oilfield chemicals. The Company operates through four business segments: Fuel Specialties, Performance Chemicals, Oilfield Services and Octane Additives. Its Fuel Specialties develops, manufactures, blends, markets and supplies various specialty chemical products that are used as additives for a range of fuels. Its Performance Chemicals provides technology-based solutions. Its Oilfield Services business supplies drilling, completion and production chemicals. Its Octane Additives business manufactures a fuel additive for use in automotive gasoline and provides services in respect of environmental remediation. Its customers include oil and gas exploration and production companies, fuel users, and oil refiners among others.

About Sigma-Aldrich Corporation

Sigma-Aldrich Corporation is a life science and high technology company. The Company develops, manufactures, purchases and distributes a range of biochemical and organic chemical products, kits and services that are used in scientific research. It manufactures and distributes around 250,000 chemicals, biochemical and other essential products and approximately 46,000 equipment products. Its business unit structure is aligned into three business units: Research, Applied and SAFC Commercial. Its brands include Sigma-Aldrich, Sigma, Aldrich, Fluka, Riedel-de Haen, Supelco, SAFC, SAFC Biosciences, SAFC Hitech, Genosys, Proligo, Pharmorphix, Cerilliant, Vetec, BioReliance and Cell Marque. It offers its products and services to research and applied labs, pharmaceutical companies, universities, commercial laboratories, industrial companies, biotechnology companies and non-profit organizations, among others. It operates in around 37 countries and sells into approximately 160 countries.

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