Contrasting Gulf Resources (NASDAQ:GURE) and Albemarle (NYSE:ALB)

Albemarle (NYSE:ALB) and Gulf Resources (NASDAQ:GURE) are both basic materials companies, but which is the better business? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, dividends, valuation, profitability and analyst recommendations.

Profitability

This table compares Albemarle and Gulf Resources’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Albemarle	-10.74%	0.41%	0.19%
Gulf Resources	-286.77%	-20.62%	-17.50%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Albemarle and Gulf Resources, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Albemarle	2	11	13	2	2.54
Gulf Resources	1	0	0	0	1.00

Albemarle presently has a consensus target price of $170.24, indicating a potential downside of 4.58%. Given Albemarle’s stronger consensus rating and higher probable upside, equities analysts plainly believe Albemarle is more favorable than Gulf Resources.

Valuation & Earnings

This table compares Albemarle and Gulf Resources”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Albemarle	$5.14 billion	4.09	-$510.63 million	($5.75)	-31.03
Gulf Resources	$7.66 million	1.58	-$58.94 million	($48.05)	-0.16

Gulf Resources has lower revenue, but higher earnings than Albemarle. Albemarle is trading at a lower price-to-earnings ratio than Gulf Resources, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

92.9% of Albemarle shares are held by institutional investors. Comparatively, 3.3% of Gulf Resources shares are held by institutional investors. 0.3% of Albemarle shares are held by insiders. Comparatively, 3.2% of Gulf Resources shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Volatility and Risk

Albemarle has a beta of 1.43, suggesting that its share price is 43% more volatile than the S&P 500. Comparatively, Gulf Resources has a beta of 0.13, suggesting that its share price is 87% less volatile than the S&P 500.

Summary

Albemarle beats Gulf Resources on 12 of the 15 factors compared between the two stocks.

About Albemarle

Albemarle Corporation develops, manufactures, and markets engineered specialty chemicals worldwide. It operates through three segments: Energy Storage, Specialties and Ketjen. The Energy Storage segment offers lithium compounds, including lithium carbonate, lithium hydroxide, and lithium chloride; technical services for the handling and use of reactive lithium products; and lithium-containing by-products recycling services. The Specialties segment provides bromine-based specialty chemicals, including elemental bromine, alkyl and inorganic bromides, brominated powdered activated carbon, and other bromine fine chemicals; lithium specialties, such as butyllithium and lithium aluminum hydride; develops and manufactures cesium products for the chemical and pharmaceutical industries; and zirconium, barium, and titanium products for pyrotechnical applications that include airbag initiators. The Ketjen segment offers clean fuels technologies (CFT), which is composed of hydroprocessing catalysts (HPC) together with isomerization and akylation catalysts; fluidized catalytic cracking (FCC) catalysts and additives; and performance catalyst solutions (PCS), which is composed of organometallics and curatives. The company serves the energy storage, petroleum refining, consumer electronics, construction, automotive, lubricants, pharmaceuticals, and crop protection markets. Albemarle Corporation was founded in 1887 and is headquartered in Charlotte, North Carolina.

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.