Head to Head Review: Atotech (NYSE:ATC) & Cabot (NYSE:CBT)

Atotech (NYSE:ATC) and Cabot (NYSE:CBT) are both mid-cap basic materials companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, valuation, analyst recommendations, earnings, risk and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Atotech and Cabot, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Atotech 0 6 5 0 2.45
Cabot 1 2 4 0 2.43

Atotech presently has a consensus target price of $24.11, suggesting a potential downside of 2.19%. Cabot has a consensus target price of $74.29, suggesting a potential upside of 41.74%. Given Cabot’s higher probable upside, analysts plainly believe Cabot is more favorable than Atotech.

Profitability

This table compares Atotech and Cabot’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Atotech N/A N/A N/A
Cabot -5.17% 19.21% 6.12%

Valuation & Earnings

This table compares Atotech and Cabot’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Atotech $1.23 billion 3.89 -$289.40 million ($4.64) -5.31
Cabot $2.61 billion 1.14 -$238.00 million $2.08 25.20

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

Insider and Institutional Ownership

95.6% of Atotech shares are held by institutional investors. Comparatively, 86.8% of Cabot shares are held by institutional investors. 1.8% of Cabot shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Cabot beats Atotech on 7 of the 13 factors compared between the two stocks.

Atotech Company Profile

Atotech Limited, a chemicals technology company, provides specialty electroplating and surface finishing solutions worldwide. The company operates in two segments, Electronics (EL) and General Metal Finishing (GMF). The EL segment manufactures and supplies chemistry, production equipment, and services to the electronics industry, which include printed circuit board manufacturers, package substrate makers, and semiconductor companies. Its products and technologies serve the principal electronics end-markets, including communication, computer, automotive, industrial, medical, aerospace, and military industries. The GMF segment provides chemistry, production technology, and services to the surface finishing industries in various areas of application. Its products and technologies serve the primary surface finishing end-markets comprising the automotive, consumer electronics, construction, sanitary, white goods, and oil and gas industries. The company also offers on-site support and training services. Atotech Limited was founded in 1851 and is headquartered in West Bromwich, United Kingdom.

Cabot Company Profile

Cabot Corporation operates as a specialty chemicals and performance materials company. It operates through three segments: Reinforcement Materials, Performance Chemicals, and Purification Solutions. The company offers rubber grade carbon blacks used in tires as a rubber reinforcing agent and performance additive, as well as in industrial products, such as hoses, belts, extruded profiles, and molded goods; and engineered elastomer composites. It also provides specialty grades of carbon black used in inks, coatings, plastics, adhesives, toners, batteries, and displays applications; masterbatch and conductive compound products for use in automotive, industrial, packaging, infrastructure, agriculture, consumer products, and electronics industries; inkjet colorants used in the inkjet printing applications; fumed silica used in adhesives, sealants, cosmetics, batteries, inks, toners, silicone elastomers, coatings, polishing slurries, and pharmaceuticals; fumed alumina used in various products, including inkjet media, lighting, coatings, cosmetics, and polishing slurries; and aerogel, a hydrophobic, silica-based particle for use in various thermal insulation and specialty chemical applications. In addition, the company offers activated carbon products used for the purification of water, air, food and beverages, pharmaceuticals, and other liquids and gases; and activated carbon solutions for activated carbon injection in coal-fired utilities, mobile water filter units, and carbon reactivation services. The company sells its products through distributors and sales representatives in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. Cabot Corporation was founded in 1882 and is headquartered in Boston, Massachusetts.

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