American Vanguard (NYSE:AVD – Get Free Report) and International Flavors & Fragrances (NYSE:IFF – Get Free Report) are both basic materials companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, earnings, profitability, dividends, analyst recommendations, risk and institutional ownership.
Profitability
This table compares American Vanguard and International Flavors & Fragrances’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| American Vanguard | -9.68% | -5.13% | -1.76% |
| International Flavors & Fragrances | -3.20% | 7.67% | 4.07% |
Analyst Ratings
This is a summary of recent ratings and recommmendations for American Vanguard and International Flavors & Fragrances, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| American Vanguard | 1 | 0 | 1 | 0 | 2.00 |
| International Flavors & Fragrances | 1 | 4 | 13 | 0 | 2.67 |
Volatility & Risk
American Vanguard has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500. Comparatively, International Flavors & Fragrances has a beta of 0.99, meaning that its share price is 1% less volatile than the S&P 500.
Institutional & Insider Ownership
79.0% of American Vanguard shares are owned by institutional investors. Comparatively, 96.0% of International Flavors & Fragrances shares are owned by institutional investors. 7.6% of American Vanguard shares are owned by insiders. Comparatively, 0.2% of International Flavors & Fragrances shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Earnings and Valuation
This table compares American Vanguard and International Flavors & Fragrances”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| American Vanguard | $515.11 million | 0.11 | -$49.88 million | ($1.75) | -1.18 |
| International Flavors & Fragrances | $10.89 billion | 1.67 | -$361.00 million | ($1.37) | -51.82 |
American Vanguard has higher earnings, but lower revenue than International Flavors & Fragrances. International Flavors & Fragrances is trading at a lower price-to-earnings ratio than American Vanguard, indicating that it is currently the more affordable of the two stocks.
Dividends
American Vanguard pays an annual dividend of $0.03 per share and has a dividend yield of 1.5%. International Flavors & Fragrances pays an annual dividend of $1.60 per share and has a dividend yield of 2.3%. American Vanguard pays out -1.7% of its earnings in the form of a dividend. International Flavors & Fragrances pays out -116.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. International Flavors & Fragrances is clearly the better dividend stock, given its higher yield and lower payout ratio.
Summary
International Flavors & Fragrances beats American Vanguard on 11 of the 16 factors compared between the two stocks.
About American Vanguard
American Vanguard Corporation, through its subsidiaries, develops, manufactures, and markets specialty chemicals for agricultural, commercial, and consumer uses in the United States and internationally. It manufactures and formulates chemicals, including insecticides, fungicides, herbicides, soil health, plant nutrition, molluscicides, growth regulators, soil fumigants, and biorationals in liquid, powder, and granular forms for crops, turf and ornamental plants, and human and animal health protection. The company also markets, sells, and distributes end-use chemical and biological products for crop applications; and distributes chemicals for turf and ornamental markets. It distributes its products through national distribution companies, and buying groups or co-operatives; and through sales offices, sales force executives, sales agents, and wholly owned distributors. American Vanguard Corporation was incorporated in 1969 and is headquartered in Newport Beach, California.
About International Flavors & Fragrances
International Flavors & Fragrances, Inc. engages in the manufacture and supply of flavors and fragrances used in the food, beverage, personal care, and household products industries. It operates through the following segments: Nourish, Health & Biosciences, Scent and Pharma Solutions. The Nourish segment consists of legacy Taste segment combined with N&B’s Food & Beverage division and the food protection business of N&B’s Health & Biosciences division. The Health & Biosciences business consists of a biotechnology-driven portfolio of enzymes, food cultures, probiotics and specialty ingredients for food, home and personal care, and health and wellness applications. The Scent business creates fragrance compounds, fragrance ingredients and cosmetic ingredients that are integral elements in the world’s finest perfumes and best-known household and personal care products. The Pharma Solutions business produces a vast portfolio including cellulosics and seaweed-based pharma excipients, used to improve the functionality and delivery of active pharmaceutical ingredients, including controlled or modified drug release formulations, and enabling. The company was founded in 1833 and is headquartered in New York, NY.
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