Head-To-Head Comparison: Solutia (SOA) and FMC Corporation (FMC)

Solutia (NYSE: SOA) and FMC Corporation (NYSE:FMC) are both mid-cap basic materials companies, but which is the better business? We will compare the two businesses based on the strength of their profitability, risk, dividends, institutional ownership, analyst recommendations, earnings and valuation.

Valuation and Earnings

This table compares Solutia and FMC Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Solutia N/A N/A N/A $2.06 N/A
FMC Corporation $3.28 billion 3.86 $209.10 million $0.17 555.41

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

Dividends

FMC Corporation pays an annual dividend of $0.66 per share and has a dividend yield of 0.7%. Solutia does not pay a dividend. FMC Corporation pays out 388.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. FMC Corporation has raised its dividend for 6 consecutive years.

Institutional and Insider Ownership

90.7% of FMC Corporation shares are owned by institutional investors. 1.1% of FMC Corporation shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Solutia and FMC Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Solutia N/A N/A N/A
FMC Corporation 0.78% 16.77% 5.57%

Analyst Recommendations

This is a breakdown of current ratings and target prices for Solutia and FMC Corporation, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Solutia 0 0 0 0 N/A
FMC Corporation 0 5 13 0 2.72

FMC Corporation has a consensus target price of $92.50, indicating a potential downside of 2.03%.

Summary

FMC Corporation beats Solutia on 9 of the 11 factors compared between the two stocks.

Solutia Company Profile

Solutia Inc., together with its subsidiaries, is a global manufacturer of performance materials and specialty chemicals used in a range of consumer and industrial applications, including interlayers and aftermarket film for automotive and architectural glass; chemicals that promote safety and durability in tires, and encapsulants, coatings and specialty chemicals used in a variety of electronic, industrial and energy solutions. The Company operates in three segments: Advanced Interlayers; Performance Films; and Technical Specialties. On November 23, 2011, the Company acquired Southwall Technologies Inc. (Southwall). In April 2011, the Company sold its Santoweb and Vocol businesses to Rhein Chemie, a wholly owned subsidiary of LANXESS AG.

FMC Corporation Company Profile

FMC Corporation is a diversified chemical company serving agricultural, consumer and industrial markets. The Company operates in three business segments: FMC Agricultural Solutions, FMC Health and Nutrition, and FMC Lithium. As of December 31, 2016, the FMC Agricultural Solutions segment developed, marketed and sold three classes of crop protection chemicals: insecticides, herbicides and fungicides. The Company’s FMC Agricultural Solutions segment operates in the agrochemicals industry. This segment develops, manufactures and sells a portfolio of professional pest control, and lawn and garden products. The FMC Health and Nutrition segment focuses on nutritional ingredients, health excipients and functional health ingredients. The Company’s FMC Health and Nutrition segment focuses on food ingredients, pharmaceutical excipients and omega-3 oils. The Company’s FMC Lithium segment manufactures lithium for use in a range of lithium products.

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