Perimeter Solutions (NYSE:PRM) and NL Industries (NYSE:NL) Head to Head Analysis

NL Industries (NYSE:NL) and Perimeter Solutions (NYSE:PRM) are both basic materials companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, dividends, profitability, risk, earnings, analyst recommendations and institutional ownership.

Risk & Volatility

NL Industries has a beta of 0.2, suggesting that its stock price is 80% less volatile than the S&P 500. Comparatively, Perimeter Solutions has a beta of 1.9, suggesting that its stock price is 90% more volatile than the S&P 500.

Valuation & Earnings

This table compares NL Industries and Perimeter Solutions”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NL Industries	$158.30 million	1.89	-$37.83 million	($0.69)	-8.86
Perimeter Solutions	$705.90 million	7.77	-$206.37 million	($1.34)	-25.10

NL Industries has higher earnings, but lower revenue than Perimeter Solutions. Perimeter Solutions is trading at a lower price-to-earnings ratio than NL Industries, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares NL Industries and Perimeter Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NL Industries	-21.56%	-8.74%	-7.02%
Perimeter Solutions	-26.93%	18.29%	7.73%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for NL Industries and Perimeter Solutions, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NL Industries	0	1	0	0	2.00
Perimeter Solutions	0	1	4	1	3.00

Perimeter Solutions has a consensus target price of $43.00, indicating a potential upside of 27.84%. Given Perimeter Solutions’ stronger consensus rating and higher probable upside, analysts clearly believe Perimeter Solutions is more favorable than NL Industries.

Institutional and Insider Ownership

10.7% of NL Industries shares are held by institutional investors. Comparatively, 89.9% of Perimeter Solutions shares are held by institutional investors. 0.3% of NL Industries shares are held by company insiders. Comparatively, 13.1% of Perimeter Solutions shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Perimeter Solutions beats NL Industries on 11 of the 15 factors compared between the two stocks.

About NL Industries

NL Industries, Inc., through its subsidiary, CompX International Inc., operates in the component products industry in Europe, North America, the Asia Pacific, and internationally. The company manufactures and sells mechanical and electronic cabinet locks and other locking mechanisms, including disc tumbler locks; pin tumbler locking mechanisms under KeSet, System 64, TuBar, and Turbine brands; and electronic locks under CompX eLock and StealthLock brands for use in various applications, such as mailboxes, ignition systems, file cabinets, desk drawers, tool storage cabinets, high security medical cabinetry, integrated inventory and access control secured narcotics boxes, electronic circuit panels, storage compartments, gas station security, vending and cash containment machines. It also offers original equipment and aftermarket stainless steel exhaust headers, exhaust pipes, mufflers, and other exhaust components; gauges, such as GPS speedometers and tachometers; mechanical and electronic controls and throttles; wake enhancement devices, trim tabs, steering wheels, and other billet aluminum accessories; dash panels, LED indicators, wire harnesses, and other accessories; and grab handles, pin cleats, and other accessories; primarily for performance and ski/wakeboard and performance boats. In addition, the company produces and markets value-added titanium dioxide pigments, a base industrial product used in imparting whiteness, brightness, opacity, and durability to a diverse range of customer applications and end-use markets, including coatings, plastics, paper, inks, cosmetics, pharmaceuticals, and other industrial and consumer products. The company sells its component products directly to original equipment manufacturers, as well as through distributors. NL Industries, Inc. was founded in 1891 and is based in Dallas, Texas. NL Industries, Inc. operates as a subsidiary of Valhi, Inc.

About Perimeter Solutions

Perimeter Solutions, SA manufactures and supplies firefighting products and lubricant additives in the United States, Germany, and internationally. It operates in two segments, Fire Safety and Specialty Products. The Fire Safety segment provides fire retardants and firefighting foams, as well as specialized equipment and services for federal, state, provincial, local/municipal, and commercial customers. The Specialty Products segment produces and sells Phosphorus Pentasulfide, which is primarily used in the preparation of lubricant additives, including a family of compounds called Zinc Dialkyldithiophosphates. The company offers its products under the PHOS-CHEK, FIRE-TROL, AUXQUIMIA, and SOLBERG brands. Perimeter Solutions, SA was founded in 1963 and is headquartered in Clayton, Missouri.