Air Liquide (OTCMKTS:AIQUY) & Valhi (NYSE:VHI) Critical Review

Valhi (NYSE:VHI) and Air Liquide (OTCMKTS:AIQUY) are both basic materials companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, risk, valuation, dividends, analyst recommendations, institutional ownership and profitability.

Institutional and Insider Ownership

3.8% of Valhi shares are owned by institutional investors. Comparatively, 0.0% of Air Liquide shares are owned by institutional investors. 0.2% of Valhi shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Valhi and Air Liquide”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Valhi	$2.10 billion	0.18	$108.00 million	$0.64	21.29
Air Liquide	$29.28 billion	3.65	$3.58 billion	N/A	N/A

Air Liquide has higher revenue and earnings than Valhi.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Valhi and Air Liquide, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Valhi	2	0	0	0	1.00
Air Liquide	0	3	2	1	2.67

Valhi currently has a consensus price target of $12.00, suggesting a potential downside of 11.93%. Given Valhi’s higher probable upside, equities research analysts clearly believe Valhi is more favorable than Air Liquide.

Profitability

This table compares Valhi and Air Liquide’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Valhi	0.89%	2.22%	1.13%
Air Liquide	N/A	N/A	N/A

Dividends

Valhi pays an annual dividend of $0.32 per share and has a dividend yield of 2.3%. Air Liquide pays an annual dividend of $0.48 per share and has a dividend yield of 1.3%. Valhi pays out 50.0% of its earnings in the form of a dividend.

Risk and Volatility

Valhi has a beta of 1.18, meaning that its share price is 18% more volatile than the S&P 500. Comparatively, Air Liquide has a beta of 0.84, meaning that its share price is 16% less volatile than the S&P 500.

Summary

Valhi beats Air Liquide on 8 of the 15 factors compared between the two stocks.

About Valhi

Valhi, Inc. engages in the chemicals, component products, and real estate management and development businesses in Europe, North America, the Asia Pacific, and internationally. The company’s Chemicals segment produces and markets titanium dioxide pigments (TiO2), which are white inorganic pigments used in various applications by paint, plastics, decorative laminate, and paper manufacturers. It offers TiO2 under the KRONOS name through agents and distributors. The company’s Component Products segment manufactures mechanical and electrical cabinet locks, and other locking mechanisms for use in ignition systems, mailboxes, file cabinets, desk drawers, tool storage cabinets, vending and cash containment machines, integrated inventory and access control secured narcotics boxes, medical cabinetry security, electronic circuit panels, storage compartments, and gas station security applications. It also provides stainless steel exhaust components, gauges, throttle controls, wake enhancement systems, trim tabs, and related hardware and accessories primarily for performance and ski/wakeboard boats. The company’s Real Estate Management and Development segment offers utility services to industrial and municipal customers; owns real properties; and develops land holdings for commercial, industrial, and residential purposes. It also holds marketable securities and other investments. The company was incorporated in 1932 and is based in Dallas, Texas. Valhi, Inc. is a subsidiary of Dixie Rice Agricultural L.L.C.

About Air Liquide

L'Air Liquide S.A. provides gases, technologies, and services for the industrial and health sectors in Europe, the Americas, the Asia Pacific, the Middle East, and Africa. It operates in Gas & Services, Engineering & Construction, and Global Markets & Technologies segments. The Gas & Services segment comprises large industries business, which offers gas and energy solutions including oxygen, nitrogen, argon, hydrogen, and carbon monoxide, as well as operates cogeneration plants to supply steam and electricity to metals, chemicals, refining, and energy industries; and industrial merchant business line provides industrial gases, equipment, hardgoods, and associated services to materials and energy, automotive and manufacturing, food and pharmaceuticals, technology and research, and craftsmen and retail sectors. This segment also includes healthcare business, which provides medical gases, home healthcare services, medical equipment, and specialty ingredient to patients, healthcare professionals, and hospitals; and electronic business supply carrier gases, electronic specialty and advanced materials, equipment and installation, and service to semiconductor, flat panel, and photovoltaic markets. The Engineering & Construction segment designs, develops, and builds industrial gas production plants to third parties; and design and manufacture plants in traditional, renewable and alternative energy sectors. The Global Markets & Technologies segment delivers technological solutions, such as molecules, equipment, and services to energy transition and deep technology. This segment also invests in and operates biomethane production units; designs hydrogen refueling stations; and supplies gases for the offshore oil and gas platforms, offshore wind turbines, and cryogenic transportation by sea. L'Air Liquide S.A. was incorporated in 1902 and is headquartered in Paris, France.