Contrasting NewMarket (NYSE:NEU) & SIKA (OTCMKTS:SXYAY)

SIKA (OTCMKTS:SXYAY) and NewMarket (NYSE:NEU) are both 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.

Analyst Recommendations

This is a breakdown of current ratings and target prices for SIKA and NewMarket, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SIKA	1	3	2	1	2.43
NewMarket	0	0	1	0	3.00

Institutional and Insider Ownership

61.1% of NewMarket shares are owned by institutional investors. 8.6% of NewMarket 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.

Volatility & Risk

SIKA has a beta of 1.08, meaning that its stock price is 8% more volatile than the S&P 500. Comparatively, NewMarket has a beta of 0.56, meaning that its stock price is 44% less volatile than the S&P 500.

Profitability

This table compares SIKA and NewMarket’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SIKA	N/A	N/A	N/A
NewMarket	15.25%	24.12%	12.24%

Dividends

SIKA pays an annual dividend of $0.10 per share and has a dividend yield of 0.5%. NewMarket pays an annual dividend of $12.00 per share and has a dividend yield of 1.5%. NewMarket pays out 27.4% of its earnings in the form of a dividend. NewMarket has raised its dividend for 7 consecutive years. NewMarket is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares SIKA and NewMarket”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SIKA	$13.52 billion	2.44	$1.26 billion	N/A	N/A
NewMarket	$2.73 billion	2.67	$418.75 million	$43.78	18.07

SIKA has higher revenue and earnings than NewMarket.

Summary

NewMarket beats SIKA on 9 of the 15 factors compared between the two stocks.

About SIKA

Sika AG, a specialty chemicals company, develops, produces, and sells systems and products for bonding, sealing, damping, reinforcing, and protecting in the building sector and motor vehicle industry worldwide. The company offers tile adhesives and grouts, systems for under-tile waterproofing, sound reduction, renders, decorative finishes for exterior and interior walls, as well as exterior insulation finishing system; develops admixtures and additives for concrete, cement, and mortar production; and flat roofing systems. It also provides a range of technologies used for below and above-ground waterproofing, including flexible membrane systems, liquid-applied membranes, joint waterproofing systems, and waterproofing mortars and injection resins for commercial and residential basements, tunnels, bridges, and various types of water-retaining structures, such as reservoirs, storage basins, and storage tanks. In addition, the company offers flooring solutions, such as synthetic resin and cementitious systems for industrial and commercial buildings; and sealants, adhesives, tapes, and spray foams for the building facades, interior finishing, and infrastructure projects. Further, it provides repairing, reinforcing, and protective solutions for concrete structures, such as repair mortars, shrinking grouts, anchoring adhesives, protective coatings, corrosion control, and structural strengthening systems. The company serves automobile and commercial vehicle assembly, automotive aftermarket, marine vessel, industrial lamination, renewable energy, home appliance, and facade engineering industries. The company was founded in 1910 and is headquartered in Baar, Switzerland.

About NewMarket

NewMarket Corporation, through its subsidiaries, primarily engages in the manufacture and sale of petroleum additives. The company offers lubricant additives for use in various vehicle and industrial applications, including engine oils, transmission fluids, off-road powertrain and hydraulic systems, gear oils, hydraulic oils, turbine oils, and other applications where metal-to-metal moving parts are utilized; engine oil additives designed for passenger cars, motorcycles, on and off-road heavy duty commercial equipment, locomotives, and engines in ocean-going vessels; driveline additives designed for products, such as transmission fluids, axle fluids, and off-road powertrain fluids; and industrial additives designed for products for industrial applications consisting of hydraulic fluids, grease, industrial gear fluids, and industrial specialty applications, such as turbine oils. It also provides fuel additives that are used to enhance the oil refining process and the performance of gasoline, diesel, biofuels, and other fuels to industry, government, original equipment manufacturers, and individual customers. In addition, the company engages in the marketing of antiknock compounds, as well as contracted manufacturing and services activities; and owns and manages a real property in Virginia. It operates in North America, Latin America, Asia Pacific, Europe, the Middle East, Africa, and India. NewMarket Corporation was founded in 1887 and is headquartered in Richmond, Virginia.