Hawkins (NASDAQ:HWKN) and W. R. Grace & Co. (NYSE:GRA) are both basic materials companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, valuation, institutional ownership, earnings, analyst recommendations, risk and profitability.
Dividends
Hawkins pays an annual dividend of $0.98 per share and has a dividend yield of 1.5%. W. R. Grace & Co. pays an annual dividend of $1.20 per share and has a dividend yield of 2.0%. Hawkins pays out 36.8% of its earnings in the form of a dividend. W. R. Grace & Co. pays out 27.4% 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. Hawkins has increased its dividend for 1 consecutive years and W. R. Grace & Co. has increased its dividend for 1 consecutive years. W. R. Grace & Co. is clearly the better dividend stock, given its higher yield and lower payout ratio.
Profitability
This table compares Hawkins and W. R. Grace & Co.'s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
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Hawkins | 6.12% | 13.82% | 8.33% |
W. R. Grace & Co. | 0.76% | 55.80% | 5.10% |
Analyst Ratings
This is a breakdown of recent ratings and target prices for Hawkins and W. R. Grace & Co., as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
Hawkins | 0 | 0 | 1 | 0 | 3.00 |
W. R. Grace & Co. | 0 | 3 | 6 | 0 | 2.67 |
Hawkins presently has a consensus target price of $67.00, suggesting a potential upside of 5.93%. W. R. Grace & Co. has a consensus target price of $64.6250, suggesting a potential upside of 9.39%. Given W. R. Grace & Co.'s higher probable upside, analysts plainly believe W. R. Grace & Co. is more favorable than Hawkins.
Volatility & Risk
Hawkins has a beta of 0.85, suggesting that its stock price is 15% less volatile than the S&P 500. Comparatively, W. R. Grace & Co. has a beta of 1.47, suggesting that its stock price is 47% more volatile than the S&P 500.
Insider & Institutional Ownership
61.0% of Hawkins shares are owned by institutional investors. Comparatively, 84.8% of W. R. Grace & Co. shares are owned by institutional investors. 5.0% of Hawkins shares are owned by insiders. Comparatively, 0.9% of W. R. Grace & Co. shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Valuation & Earnings
This table compares Hawkins and W. R. Grace & Co.'s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
Hawkins | $540.20 million | 1.24 | $28.37 million | $2.66 | 23.82 |
W. R. Grace & Co. | $1.96 billion | 2.00 | $126.30 million | $4.38 | 13.54 |
W. R. Grace & Co. has higher revenue and earnings than Hawkins. W. R. Grace & Co. is trading at a lower price-to-earnings ratio than Hawkins, indicating that it is currently the more affordable of the two stocks.
Summary
W. R. Grace & Co. beats Hawkins on 12 of the 16 factors compared between the two stocks.