Stepan (NYSE:SCL – Get Free Report) and ICL Group (NYSE:ICL – Get Free Report) are both materials companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, dividends, risk, institutional ownership, valuation, analyst recommendations and earnings.
Institutional & Insider Ownership
82.7% of Stepan shares are owned by institutional investors. Comparatively, 13.4% of ICL Group shares are owned by institutional investors. 6.6% of Stepan shares are owned by insiders. Comparatively, 0.3% of ICL Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Analyst Ratings
This is a breakdown of recent recommendations and price targets for Stepan and ICL Group, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Stepan | 1 | 1 | 0 | 0 | 1.50 |
| ICL Group | 0 | 2 | 0 | 0 | 2.00 |
Valuation and Earnings
This table compares Stepan and ICL Group”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Stepan | $2.33 billion | 0.60 | $46.90 million | ($0.12) | -513.46 |
| ICL Group | $7.15 billion | 1.06 | $226.00 million | $0.24 | 24.53 |
ICL Group has higher revenue and earnings than Stepan. Stepan is trading at a lower price-to-earnings ratio than ICL Group, indicating that it is currently the more affordable of the two stocks.
Dividends
Stepan pays an annual dividend of $1.58 per share and has a dividend yield of 2.6%. ICL Group pays an annual dividend of $0.17 per share and has a dividend yield of 2.9%. Stepan pays out -1,316.7% of its earnings in the form of a dividend. ICL Group pays out 70.8% 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. Stepan has raised its dividend for 57 consecutive years.
Volatility and Risk
Stepan has a beta of 0.94, suggesting that its stock price is 6% less volatile than the S&P 500. Comparatively, ICL Group has a beta of 0.98, suggesting that its stock price is 2% less volatile than the S&P 500.
Profitability
This table compares Stepan and ICL Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Stepan | -0.11% | 3.90% | 2.01% |
| ICL Group | 3.95% | 8.40% | 4.19% |
Summary
ICL Group beats Stepan on 12 of the 16 factors compared between the two stocks.
About Stepan
Stepan Company, together with its subsidiaries, produces and sells specialty and intermediate chemicals to other manufacturers for use in various end products worldwide. It operates through three segments: Surfactants, Polymers, and Specialty Products. The Surfactants segment offers surfactants that are used in consumer and industrial cleaning and disinfection products, including detergents for washing clothes, dishes, carpets, and floors and walls, as well as shampoos and body washes; and other applications, such as fabric softeners, germicidal quaternary compounds, disinfectants, and lubricating ingredients. Its surfactants are also used in various applications, including emulsifiers for spreading agricultural products; and industrial applications comprising latex systems, plastics, and composites. The Polymers segment provides polyurethane polyols that are used in the manufacture of rigid foam for thermal insulation in the construction industry, as well as a base raw material for coatings, adhesives, sealants, and elastomers (CASE); polyester resins, including liquid and powdered products, which are used in CASE applications; and phthalic anhydride that is used in unsaturated polyester resins, alkyd resins, and plasticizers for applications in construction materials, as well as components of automotive, boating, and other consumer products. The Specialty Products segment offers flavors, emulsifiers, and solubilizers for use in food, flavoring, nutritional supplement, and pharmaceutical applications. Stepan Company was founded in 1932 and is headquartered in Northbrook, Illinois.
About ICL Group
ICL Group Ltd, together with its subsidiaries, operates as a specialty minerals and chemicals company worldwide. It operates in four segments: Industrial Products, Potash, Phosphate Solutions, and Growing Solutions. The Industrial Products segment produces bromine out of a solution that is a by-product of the potash production process, as well as bromine-based compounds; produces various grades of potash, salt, magnesium chloride, and magnesia products; and produces and markets phosphorous-based flame retardants and other phosphorus-based products. The Potash segment extracts potash from the Dead Sea; mines and produces potash and salt; produces polysulphate; produces, markets, and sells magnesium and magnesium alloys, as well as related by-products, including chlorine and sylvinite; and sells salt. The Phosphate Solutions segment uses phosphate commodity products to produce specialty products; produces and markets phosphate-based fertilizers, as well as sulphuric acid, green phosphoric acid, and phosphate fertilizers; and manufactures thermal phosphoric acid for various industrial end markets, such as oral care, cleaning products, paints and coatings, water treatment, asphalt modification, construction, and metal treatment. It also develops and produces functional food ingredients and phosphate additives for use in the processed meat, poultry, seafood, dairy, beverage, and baked goods markets; and produces milk and whey proteins for the food ingredients industry. The Growing Solutions segment develops, manufactures, markets, and sells fertilizers based primarily on nitrogen, potash, and phosphate, including water soluble specialty, liquid, soluble, and controlled-release fertilizers. It sells its products through marketing companies, agents, and distributors. The company was formerly known as Israel Chemicals Ltd. and changed its name to ICL Group Ltd in May 2020. The company was founded in 1968 and is headquartered in Tel Aviv, Israel.
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