Ashland Global (NYSE:ASH) and International Flavors & Fragrances (NYSE:IFF) are both basic materials companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, risk, valuation, profitability, earnings, institutional ownership and dividends.
Volatility & Risk
Ashland Global has a beta of 1.35, suggesting that its share price is 35% more volatile than the S&P 500. Comparatively, International Flavors & Fragrances has a beta of 0.97, suggesting that its share price is 3% less volatile than the S&P 500.
Valuation & Earnings
This table compares Ashland Global and International Flavors & Fragrances' top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Ashland Global | $2.33 billion | 2.31 | $-508,000,000.00 | $2.80 | 31.68 |
| International Flavors & Fragrances | $5.14 billion | 6.77 | $455.87 million | $6.17 | 22.67 |
International Flavors & Fragrances has higher revenue and earnings than Ashland Global. International Flavors & Fragrances is trading at a lower price-to-earnings ratio than Ashland Global, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Ashland Global and International Flavors & Fragrances' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Ashland Global | -21.84% | 5.40% | 2.43% |
| International Flavors & Fragrances | 7.44% | 11.00% | 5.10% |
Analyst Ratings
This is a breakdown of recent recommendations and price targets for Ashland Global and International Flavors & Fragrances, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Ashland Global | 0 | 1 | 7 | 0 | 2.88 |
| International Flavors & Fragrances | 0 | 4 | 11 | 0 | 2.73 |
Ashland Global currently has a consensus price target of $91.00, suggesting a potential upside of 2.29%. International Flavors & Fragrances has a consensus price target of $145.4933, suggesting a potential upside of 3.94%. Given International Flavors & Fragrances' higher probable upside, analysts plainly believe International Flavors & Fragrances is more favorable than Ashland Global.
Institutional & Insider Ownership
91.9% of Ashland Global shares are held by institutional investors. Comparatively, 94.4% of International Flavors & Fragrances shares are held by institutional investors. 10.1% of Ashland Global shares are held by company insiders. Comparatively, 0.4% of International Flavors & Fragrances shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Dividends
Ashland Global pays an annual dividend of $1.10 per share and has a dividend yield of 1.2%. International Flavors & Fragrances pays an annual dividend of $3.08 per share and has a dividend yield of 2.2%. Ashland Global pays out 39.3% of its earnings in the form of a dividend. International Flavors & Fragrances pays out 49.9% 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. Ashland Global has increased its dividend for 1 consecutive years and International Flavors & Fragrances has increased its dividend for 11 consecutive years. International Flavors & Fragrances is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Summary
International Flavors & Fragrances beats Ashland Global on 13 of the 17 factors compared between the two stocks.
