Cabot (NYSE: CBT) and Valvoline (NYSE:VVV) are both mid-cap basic materials companies, but which is the better business? We will compare the two companies based on the strength of their valuation, institutional ownership, analyst recommendations, risk, profitability, dividends and earnings.
Institutional & Insider Ownership
84.0% of Cabot shares are owned by institutional investors. Comparatively, 92.8% of Valvoline shares are owned by institutional investors. 2.5% of Cabot shares are owned by company insiders. Comparatively, 0.1% of Valvoline shares are owned 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.
This table compares Cabot and Valvoline’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Cabot||$2.72 billion||1.41||$241.00 million||$0.98||63.42|
|Valvoline||$2.08 billion||2.25||$304.00 million||$1.09||21.27|
Valvoline has lower revenue, but higher earnings than Cabot. Valvoline is trading at a lower price-to-earnings ratio than Cabot, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Cabot has a beta of 1.25, indicating that its stock price is 25% more volatile than the S&P 500. Comparatively, Valvoline has a beta of 0.84, indicating that its stock price is 16% less volatile than the S&P 500.
This is a summary of current ratings and recommmendations for Cabot and Valvoline, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Cabot presently has a consensus price target of $70.60, indicating a potential upside of 13.60%. Valvoline has a consensus price target of $25.50, indicating a potential upside of 10.01%. Given Cabot’s stronger consensus rating and higher probable upside, research analysts plainly believe Cabot is more favorable than Valvoline.
Cabot pays an annual dividend of $1.26 per share and has a dividend yield of 2.0%. Valvoline pays an annual dividend of $0.30 per share and has a dividend yield of 1.3%. Cabot pays out 128.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Valvoline pays out 27.5% of its earnings in the form of a dividend. Valvoline has raised its dividend for 6 consecutive years.
This table compares Cabot and Valvoline’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Cabot beats Valvoline on 9 of the 17 factors compared between the two stocks.
Cabot Company Profile
Cabot Corporation is a global specialty chemicals and performance materials company. The Company operates through four business segments: reinforcement materials, performance chemicals, purification solutions and specialty fluids. Reinforcement materials’ rubber grade carbon blacks are used to enhance the physical properties of the systems and applications in which they are incorporated. Its rubber blacks products are used in tires and industrial products. Performance Chemicals consists of two businesses: specialty carbons and formulations business, and metal oxides business. Purification Solutions’ activated carbon products are used for the purification of water, air and pharmaceuticals, among others, as either a colorant or a decolorizing agent in the production of food and beverage applications. Its specialty fluids segment produces and markets cesium formate as a drilling and completion fluid for use in high pressure and high temperature oil and gas well construction.
Valvoline Company Profile
Valvoline Inc. (Valvoline) is engaged in the production and distribution of automotive, commercial and industrial lubricants, and automotive chemicals. The Company operates through three segments: Core North America, Quick Lubes and International. The Core North America segment sells Valvoline, and other branded and private label products in the United States and Canada to both consumers performing their own automotive maintenance, referred to as Do-It-Yourself (DIY) consumers, as well as, to installer customers using Valvoline products to service vehicles owned by Do-It-For-Me (DIFM) consumers. Its Quick Lubes segment services the passenger car and light truck quick lube market through platforms, including its franchised Valvoline Instant Oil Change (VIOC) stores and Express Care. Its International segment sells Valvoline and other branded products through its affiliates, joint ventures, licensees and independent distributors. Its products include All Climate, DuraBlend and MaxLife.
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