Analyzing Nutrien (NYSE:NTR) & AdvanSix (NYSE:ASIX)

Nutrien (NYSE:NTR) and AdvanSix (NYSE:ASIX) are both materials companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, analyst recommendations, valuation, profitability, dividends, risk and institutional ownership.

Insider and Institutional Ownership

63.1% of Nutrien shares are held by institutional investors. Comparatively, 86.4% of AdvanSix shares are held by institutional investors. 3.1% of Nutrien shares are held by insiders. Comparatively, 5.0% of AdvanSix shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Dividends

Nutrien pays an annual dividend of $2.20 per share and has a dividend yield of 3.1%. AdvanSix pays an annual dividend of $0.64 per share and has a dividend yield of 4.2%. Nutrien pays out 48.0% of its earnings in the form of a dividend. AdvanSix pays out -76.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Nutrien has raised its dividend for 7 consecutive years and AdvanSix has raised its dividend for 2 consecutive years. AdvanSix is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a breakdown of recent recommendations for Nutrien and AdvanSix, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nutrien	1	6	16	0	2.65
AdvanSix	1	2	0	0	1.67

Nutrien presently has a consensus target price of $79.14, indicating a potential upside of 10.46%. AdvanSix has a consensus target price of $20.50, indicating a potential upside of 33.26%. Given AdvanSix’s higher possible upside, analysts clearly believe AdvanSix is more favorable than Nutrien.

Profitability

This table compares Nutrien and AdvanSix’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nutrien	7.78%	8.00%	3.85%
AdvanSix	-1.40%	-2.29%	-1.08%

Volatility & Risk

Nutrien has a beta of 0.67, suggesting that its stock price is 33% less volatile than the S&P 500. Comparatively, AdvanSix has a beta of 1.27, suggesting that its stock price is 27% more volatile than the S&P 500.

Earnings & Valuation

This table compares Nutrien and AdvanSix”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nutrien	$26.89 billion	1.27	$2.27 billion	$4.58	15.64
AdvanSix	$1.52 billion	0.27	$49.29 million	($0.84)	-18.31

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

Summary

Nutrien beats AdvanSix on 10 of the 16 factors compared between the two stocks.

About Nutrien

Nutrien Ltd. is a Canadian agricultural inputs and services company headquartered in Saskatoon, Saskatchewan. Formed in 2018 through the merger of Agrium and Potash Corporation of Saskatchewan, it serves farmers and other customers through fertilizer production and agricultural retail operations. The company produces potash, nitrogen and phosphate fertilizers, which are used to support crop growth. It also sells crop protection products and seeds, and provides growers with agronomic advice and other services.

About AdvanSix

AdvanSix Inc. is an integrated chemicals manufacturer that produces nylon 6 and the materials used to make it, including caprolactam. Its nylon 6 products serve applications in packaging, automotive components, carpet and other industrial and consumer products. The company also makes ammonium sulfate, which is used as a fertilizer, along with phenol, acetone and other chemical intermediates. Its integrated production operations connect these products across several stages of the chemical manufacturing process.