Financial Contrast: Aspen Aerogels (NYSE:ASPN) and Gulf Resources (NASDAQ:GURE)

Aspen Aerogels (NYSE:ASPN) and Gulf Resources (NASDAQ:GURE) are both small-cap materials companies, but which is the better investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, profitability, institutional ownership, dividends and earnings.

Analyst Recommendations

This is a summary of current ratings for Aspen Aerogels and Gulf Resources, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Aspen Aerogels	2	1	3	0	2.17
Gulf Resources	1	0	0	0	1.00

Aspen Aerogels presently has a consensus target price of $5.19, suggesting a potential downside of 24.20%. Given Aspen Aerogels’ stronger consensus rating and higher possible upside, analysts clearly believe Aspen Aerogels is more favorable than Gulf Resources.

Institutional and Insider Ownership

97.6% of Aspen Aerogels shares are owned by institutional investors. Comparatively, 3.3% of Gulf Resources shares are owned by institutional investors. 3.0% of Aspen Aerogels shares are owned by company insiders. Comparatively, 3.2% of Gulf Resources shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Volatility and Risk

Aspen Aerogels has a beta of 2.99, meaning that its share price is 199% more volatile than the S&P 500. Comparatively, Gulf Resources has a beta of -0.1, meaning that its share price is 110% less volatile than the S&P 500.

Valuation & Earnings

This table compares Aspen Aerogels and Gulf Resources”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Aspen Aerogels	$271.10 million	2.09	-$389.55 million	($1.36)	-5.03
Gulf Resources	$7.66 million	0.61	-$59.90 million	($48.05)	-0.06

Gulf Resources has lower revenue, but higher earnings than Aspen Aerogels. Aspen Aerogels is trading at a lower price-to-earnings ratio than Gulf Resources, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Aspen Aerogels and Gulf Resources’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Aspen Aerogels	-48.64%	-22.16%	-12.85%
Gulf Resources	N/A	N/A	N/A

Summary

Aspen Aerogels beats Gulf Resources on 8 of the 14 factors compared between the two stocks.

About Aspen Aerogels

Aspen Aerogels, Inc. designs, develops, manufactures, and sells aerogel insulation products primarily for use in the energy infrastructure and sustainable insulation materials markets in the United States, Asia, Canada, Europe, and Latin America. It operates in two segments, Energy Industrial and Thermal Barrier. The company offers PyroThin thermal barriers for use in lithium-ion batteries in electric vehicles and energy storage industries; Pyrogel XTE that reduces the risk of corrosion under insulation in energy infrastructure operating systems; and Pyrogel HPS for applications within the power generation market. It also offers Pyrogel XTF to provide protection against fire; Cryogel Z for sub-ambient and cryogenic applications in the energy infrastructure market; Spaceloft Subsea for use in pipe-in-pipe applications in offshore oil production; and Cryogel X201, which is used in designing cold systems, such as refrigerated appliances, cold storage equipment, and aerospace systems. The company was founded in 2001 and is headquartered in Northborough, Massachusetts.

About Gulf Resources

Gulf Resources, Inc., through its subsidiaries, manufactures and trades bromine and crude salt, chemical products, and natural gas in the People’s Republic of China. The company operates through four segments: Bromine, Crude salt, Chemical products, and Natural gas segments. It also provides bromine for use in bromine compounds, intermediates in organic synthesis, brominated flame retardants, fumigants, water purification compounds, dyes, medicines, and disinfectants. In addition, the company offers crude salt for use as a material in alkali and chlorine alkali production for use in the chemical, food and beverage, and other industries. In addition, it manufactures and sells chemical products for use in oil and gas field exploration, oil and gas distribution, oil field drilling, papermaking chemical agents, and inorganic chemicals, as well as materials that are used for human and animal antibiotics. The company is based in Shouguang, the People’s Republic of China.