Ecolab (NYSE:ECL) & Mativ (NYSE:MATV) Critical Contrast

Mativ (NYSE:MATV) and Ecolab (NYSE:ECL) are both basic materials companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, risk, earnings, institutional ownership, valuation, dividends and profitability.

Earnings & Valuation

This table compares Mativ and Ecolab”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mativ	$1.98 billion	0.20	-$337.40 million	$1.34	5.36
Ecolab	$16.45 billion	4.84	$2.08 billion	$7.39	38.32

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

Profitability

This table compares Mativ and Ecolab’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mativ	3.86%	11.77%	2.57%
Ecolab	12.80%	22.64%	9.05%

Volatility and Risk

Mativ has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500. Comparatively, Ecolab has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings for Mativ and Ecolab, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mativ	1	1	0	0	1.50
Ecolab	0	3	17	1	2.90

Ecolab has a consensus price target of $323.71, indicating a potential upside of 14.32%. Given Ecolab’s stronger consensus rating and higher probable upside, analysts clearly believe Ecolab is more favorable than Mativ.

Dividends

Mativ pays an annual dividend of $0.40 per share and has a dividend yield of 5.6%. Ecolab pays an annual dividend of $2.92 per share and has a dividend yield of 1.0%. Mativ pays out 29.9% of its earnings in the form of a dividend. Ecolab pays out 39.5% 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. Mativ has increased its dividend for 1 consecutive years and Ecolab has increased its dividend for 33 consecutive years. Mativ is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

94.9% of Mativ shares are held by institutional investors. Comparatively, 74.9% of Ecolab shares are held by institutional investors. 1.8% of Mativ shares are held by insiders. Comparatively, 0.5% of Ecolab shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

Ecolab beats Mativ on 13 of the 17 factors compared between the two stocks.

About Mativ

Mativ Holdings, Inc., together with its subsidiaries, manufactures and sells specialty materials in the United States, Europe, the Asia Pacific, the Americas, and internationally. The company operates through two segments, Advanced Technical Materials and Fiber-Based Solutions. The Advanced Technical Materials manufactures and sells various engineered polymer, resin and fiber-based substrates, nets, films, adhesive tapes, and other nonwovens for the filtration, protective solutions, release liners, and healthcare end-markets. This segment sells its products directly, as well as through sales agents and distributors. The Fiber-Based Solutions segment produces packaging and specialty paper products. This segment provides premium packaging products that are used for wine, spirits and beer labels, folding cartons, box wrap, bags, hang tags, and stored value cards servicing retail, cosmetics, spirits, and electronics end-use markets; and premium papers, which are used in commercial printing services, advertising collateral, stationery, corporate identity packages and brochures, direct mail, business cards, and other uses. It also offers branded paper-based products for the consumer channel, such as bright papers, cardstock, stationery paper, envelopes, journals, and planners. This segment distributes its products through authorized paper distributors, converters, retailers, and specialty business converters, as well as directly to end-users. The company was formerly known as Schweitzer-Mauduit International, Inc. and changed its name to Mativ Holdings, Inc. in July 2022. Mativ Holdings, Inc. was incorporated in 1995 and is headquartered in Alpharetta, Georgia.

About Ecolab

Ecolab Inc. provides water, hygiene, and infection prevention solutions and services in the United States and internationally. The company operates through three segments: Global Industrial; Global Institutional & Specialty; and Global Healthcare & Life Sciences. The Global Industrial segment offers water treatment and process applications, and cleaning and sanitizing solutions to manufacturing, food and beverage processing, transportation, chemical, metals and mining, power generation, pulp and paper, commercial laundry, petroleum, refining, and petrochemical industries. Its Global Institutional & Specialty segment provides specialized cleaning and sanitizing products to the foodservice, hospitality, lodging, government and education, and retail industries. The Global Healthcare & Life Sciences segment offers specialized cleaning and sanitizing products to the healthcare, personal care, and pharmaceutical industries, such as infection prevention and surgical solutions, and end-to-end cleaning and contamination control solutions under the Ecolab, Microtek, and Anios brand names. In addition, the company provides pest elimination services to detect, eliminate, and prevent pests, such as rodents and insects in restaurants, food and beverage processors, hotels, grocery operations, and other commercial segments including education, life sciences, and healthcare customers. Further, it offers colloidal silica for binding and polishing applications in semiconductor, catalyst, and aerospace component manufacturing, as well as chemical industries; and products and services that manage wash process through custom designed programs, premium products, dispensing equipment, water and energy management, and reduction, as well as real time data management. It sells its products through field sales and corporate account personnel, distributors, and dealers. Ecolab Inc. was founded in 1923 and is headquartered in Saint Paul, Minnesota.