Head-To-Head Comparison: FUCHS (OTCMKTS:FUPBY) versus Element Solutions (NYSE:ESI)

Element Solutions (NYSE:ESI) and FUCHS (OTCMKTS:FUPBY) are both basic materials companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, analyst recommendations, dividends, valuation, risk, institutional ownership and earnings.

Institutional & Insider Ownership

92.3% of Element Solutions shares are held by institutional investors. 6.2% of Element Solutions shares are held 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 Recommendations

This is a summary of current recommendations and price targets for Element Solutions and FUCHS, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Element Solutions	0	2	6	3	3.09
FUCHS	1	0	1	1	2.67

Element Solutions currently has a consensus price target of $39.57, indicating a potential downside of 12.88%. Given Element Solutions’ stronger consensus rating and higher probable upside, equities research analysts plainly believe Element Solutions is more favorable than FUCHS.

Profitability

This table compares Element Solutions and FUCHS’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Element Solutions	5.32%	14.19%	7.30%
FUCHS	8.91%	16.57%	12.01%

Earnings & Valuation

This table compares Element Solutions and FUCHS”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Element Solutions	$2.55 billion	4.34	$190.80 million	$0.62	73.26
FUCHS	$4.03 billion	1.49	$346.21 million	$0.70	16.39

FUCHS has higher revenue and earnings than Element Solutions. FUCHS is trading at a lower price-to-earnings ratio than Element Solutions, indicating that it is currently the more affordable of the two stocks.

Dividends

Element Solutions pays an annual dividend of $0.32 per share and has a dividend yield of 0.7%. FUCHS pays an annual dividend of $0.20 per share and has a dividend yield of 1.7%. Element Solutions pays out 51.6% of its earnings in the form of a dividend. FUCHS pays out 28.6% 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. FUCHS is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk & Volatility

Element Solutions has a beta of 1.25, indicating that its share price is 25% more volatile than the S&P 500. Comparatively, FUCHS has a beta of 0.92, indicating that its share price is 8% less volatile than the S&P 500.

Summary

Element Solutions beats FUCHS on 9 of the 17 factors compared between the two stocks.

About Element Solutions

Element Solutions Inc operates as a specialty chemicals company in the United States, China, and internationally. The company operates in two segments, Electronics, and Industrial & Specialty. The Electronics segment researches, formulates, and sells specialty chemicals and materials for various types of electronics hardware products. This segment also supplies surface mount technologies, fluxes, thermal management material, coatings, and other attachment materials; chemical formulations to the electronics industry; and advanced copper interconnects, die attachment, sintered silver material, adhesives, wafer bump processes, and photomask technologies for semiconductor industry. It primarily serves mobile communications, computers, automobiles, and aerospace equipment industries. The Industrial & Specialty segment provides industrial solutions, which include chemical systems that protect and decorate metal and plastic surfaces; consumable chemicals that enable printing image transfer on flexible packaging materials; and chemistries used in water-based hydraulic control fluids for offshore energy production applications. It serves aerospace, automotive, construction, consumer electronics, consumer packaged goods, and oil and gas production end markets. The company was formerly known as Platform Specialty Products Corporation and changed its name to Element Solutions Inc in January 2019. Element Solutions Inc was founded in 1785 and is headquartered in Fort Lauderdale, Florida.

About FUCHS

Fuchs SE develops, produces, and sells lubricants and related specialties in Europe, the Middle East, Africa, the Asia Pacific, and North and South America. The company offers automotive lubricants, such as biodegradable lubricants, central and mobile hydraulic oils, dry coatings, engine and gear oils, motorcycle/two wheelers, and service fluids, as well as various oils for agriculture sector. It also provides industrial lubricants, including chain lubricants, dry coatings, gear and hydraulic oils, machine oils, open gear lubricants, rapidly biodegradable lubricants, compressor and refrigeration oils, release agents, slideways oils, fluids and industrial oils, textile machine oils, and turbine oils. In addition, the company offers lubricating greases comprising assembly pastes, biodegradable greases, food grade greases, multi-purpose/long-life greases, pastes for extreme temperatures, perfluorinated pastes, and wheel bearing greases, as well as gear boxes, and greases for central lubricating system, extreme temperature, machine tools, plain and roller bearings, rail vehicles, spray cans or rattle cans, and solid lubricants. Further, it provides metal processing lubricants consisting of cleaners, corrosion preventives, cutting and grinding, forming lubricants, and quenching oils; and special application lubricants for application equipment, chain lubrication, dry coatings, food and beverage, gears, sugar processing, railway traffic, plain and roller bearings, glass manufacturing process, hot forming, maintenance, open gears, pastes, release agents, other specialties, special greases, and wind power plants. Additionally, the company offers open gear and surface coating services. The company was formerly known as Fuchs Petrolub SE and changed its name to Fuchs SE in July 2023. Fuchs SE was founded in 1931 and is headquartered in Mannheim, Germany.