Gulf Resources (NASDAQ:GURE – Get Free Report) and Kronos Worldwide (NYSE:KRO – Get Free Report) are both small-cap basic materials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, institutional ownership, risk, valuation, earnings and dividends.
Insider & Institutional Ownership
3.3% of Gulf Resources shares are held by institutional investors. Comparatively, 15.1% of Kronos Worldwide shares are held by institutional investors. 3.2% of Gulf Resources shares are held by company insiders. Comparatively, 0.1% of Kronos Worldwide shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Volatility & Risk
Gulf Resources has a beta of 0.34, meaning that its stock price is 66% less volatile than the S&P 500. Comparatively, Kronos Worldwide has a beta of 1.12, meaning that its stock price is 12% more volatile than the S&P 500.
Earnings & Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Gulf Resources | $7.66 million | 0.98 | -$58.94 million | ($48.05) | -0.10 |
| Kronos Worldwide | $1.86 billion | 0.33 | -$110.90 million | ($0.96) | -5.63 |
Gulf Resources has higher earnings, but lower revenue than Kronos Worldwide. Kronos Worldwide is trading at a lower price-to-earnings ratio than Gulf Resources, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Gulf Resources and Kronos Worldwide’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Gulf Resources | -286.77% | -20.62% | -17.50% |
| Kronos Worldwide | -5.96% | -11.72% | -5.00% |
Analyst Recommendations
This is a summary of current ratings and price targets for Gulf Resources and Kronos Worldwide, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Gulf Resources | 1 | 0 | 0 | 0 | 1.00 |
| Kronos Worldwide | 4 | 0 | 0 | 0 | 1.00 |
Kronos Worldwide has a consensus price target of $6.00, indicating a potential upside of 11.01%. Given Kronos Worldwide’s higher possible upside, analysts clearly believe Kronos Worldwide is more favorable than Gulf Resources.
Summary
Kronos Worldwide beats Gulf Resources on 8 of the 12 factors compared between the two stocks.
About Gulf Resources
Gulf Resources, Inc., through its subsidiaries, manufactures and trades bromine and crude salt, chemical products, and natural gas in the People’s Republic of China. The company operates through four segments: Bromine, Crude salt, Chemical products, and Natural gas segments. It also provides bromine for use in bromine compounds, intermediates in organic synthesis, brominated flame retardants, fumigants, water purification compounds, dyes, medicines, and disinfectants. In addition, the company offers crude salt for use as a material in alkali and chlorine alkali production for use in the chemical, food and beverage, and other industries. In addition, it manufactures and sells chemical products for use in oil and gas field exploration, oil and gas distribution, oil field drilling, papermaking chemical agents, and inorganic chemicals, as well as materials that are used for human and animal antibiotics. The company is based in Shouguang, the People’s Republic of China.
About Kronos Worldwide
Kronos Worldwide, Inc. produces and markets titanium dioxide pigments (TiO2) in Europe, North America, the Asia Pacific, and internationally. The company produces TiO2 in two crystalline forms, rutile and anatase to impart whiteness, brightness, opacity, and durability for various products, including paints, coatings, plastics, paper, fibers, and ceramics, as well as for various specialty products, such as inks, foods, and cosmetics. It also produces ilmenite, a raw material used directly as a feedstock by sulfate-process TiO2 plants; iron-based chemicals, which are used as treatment and conditioning agents for industrial effluents and municipal wastewater, as well as in the manufacture of iron pigments, cement, and agricultural products; specialty chemicals for use in the formulation of pearlescent pigments, and production of electroceramic capacitors for cell phones and other electronic devices, as well as for use in natural gas pipe, and other specialty applications. In addition, the company provides technical services for its products. It sells its products under the KRONOS brand through agents and distributors to paint, plastics, decorative laminate, and paper manufacturers. The company was founded in 1916 and is headquartered in Dallas, Texas. Kronos Worldwide, Inc. is a subsidiary of Valhi, Inc.
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