Brenntag (OTCMKTS:BNTGY) and Resonac (OTCMKTS:SHWDY) Critical Survey

Resonac (OTCMKTS:SHWDY) and Brenntag (OTCMKTS:BNTGY) are both mid-cap basic materials companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, risk, valuation, profitability, analyst recommendations, earnings and dividends.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Resonac and Brenntag, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Resonac	0	0	0	1	4.00
Brenntag	2	6	0	0	1.75

Brenntag has a consensus target price of $12.80, indicating a potential upside of 12.48%. Given Brenntag’s higher probable upside, analysts clearly believe Brenntag is more favorable than Resonac.

Valuation and Earnings

This table compares Resonac and Brenntag”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Resonac	$8.78 billion	0.74	$350.37 million	$0.20	175.75
Brenntag	$17.57 billion	0.47	$580.22 million	$0.64	17.78

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

Risk & Volatility

Resonac has a beta of 0.45, indicating that its stock price is 55% less volatile than the S&P 500. Comparatively, Brenntag has a beta of 0.75, indicating that its stock price is 25% less volatile than the S&P 500.

Dividends

Resonac pays an annual dividend of $0.29 per share and has a dividend yield of 0.8%. Brenntag pays an annual dividend of $0.27 per share and has a dividend yield of 2.4%. Resonac pays out 145.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Brenntag pays out 42.2% of its earnings in the form of a dividend. Brenntag is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Resonac and Brenntag’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Resonac	0.43%	3.98%	1.27%
Brenntag	2.66%	9.18%	3.70%

Summary

Brenntag beats Resonac on 10 of the 14 factors compared between the two stocks.

About Resonac

Resonac Holdings Corporation operates as a chemical company in Japan, China, rest of Asia, and internationally. It operates through Semiconductor and Electronic Materials, Mobility, Innovation Enabling Materials, and Chemicals segments. The company offers gases and solvents, abatement systems and surface treatments, CMP slurries, and anti-charging materials; semiconductor-related materials, display and sensor-related materials, and films; base and photosensitive materials for PWBs; hard disks, SiCs, and optical semiconductors for use as electronic device components; and molded plastics/sheet-formed, powder metal, and aluminum products for automotives. It also provides lithium-ion batteries and mechanical carbon; ceramics, resins, cosmetic ingredients/medicinal additives, monomers, adhesives, tapes, and chromatography products; and elastomers. In addition, the company offers polyimides; HD media; friction materials; aluminum gravity casting products; packaging/containers for food, medicine, and electronics; electrical insulating epoxy resin molded products; zipper bags and tapes; titanium oxide and alumina; and elastic polishing grindstone. Further, it provides polypropylene and polyethylene; liquefied carbon dioxide, dry ice, and gas-related equipment; liquefied oxygen, nitrogen, and argon; molecular sieve; graphite electrodes; plasters, fireproofing pipes, and wall sidings; cement and moisture removal sheets; industrial materials; and FRP, coated sand, and separating mediums. Additionally, the company engages in the contract development and manufacturing of regenerative medicines; leasing of personal computers and other business equipment; outsourcing of salary, welfare, and finance-related business; and synthesis, analysis, and SDS preparation services. The company was formerly known as Showa Denko K.K. and changed its name to Resonac Holdings Corporation in January 2023. Resonac Holdings Corporation was incorporated in 1939 and is headquartered in Tokyo, Japan.

About Brenntag

Brenntag SE purchases and supplies various industrial and specialty chemicals, and ingredients in Germany, Europe, the Middle East, Africa, the Americas, and the Asia Pacific. The company operates in two segments, Brenntag Essentials and Brenntag Specialties. It provides just-in-time delivery, product mixing, blending, repackaging, inventory management, and drum return handling. The company serves customers in various end-market industries, including nutrition, pharma, personal care, water treatment, and lubricants; and home, industrial, and institutional markets, as well as coatings and constructions, polymers, and rubber industries. The company was founded in 1874 and is based in Essen, Germany.