Reviewing ARQ (NASDAQ:ARQ) & 5N Plus (OTCMKTS:FPLSF)

5N Plus (OTCMKTS:FPLSF) and ARQ (NASDAQ:ARQ) are both small-cap materials companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, risk, analyst recommendations, dividends, institutional ownership, valuation and profitability.

Earnings & Valuation

This table compares 5N Plus and ARQ”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
5N Plus	$391.06 million	4.25	$50.57 million	$0.70	26.43
ARQ	$120.34 million	0.83	-$52.61 million	($1.26)	-1.83

5N Plus has higher revenue and earnings than ARQ. ARQ is trading at a lower price-to-earnings ratio than 5N Plus, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares 5N Plus and ARQ’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
5N Plus	14.14%	26.36%	11.28%
ARQ	-42.33%	-2.54%	-1.88%

Analyst Ratings

This is a breakdown of recent recommendations for 5N Plus and ARQ, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
5N Plus	0	1	2	1	3.00
ARQ	1	1	1	0	2.00

ARQ has a consensus target price of $5.00, indicating a potential upside of 117.39%. Given ARQ’s higher possible upside, analysts plainly believe ARQ is more favorable than 5N Plus.

Volatility and Risk

5N Plus has a beta of 1.86, indicating that its share price is 86% more volatile than the S&P 500. Comparatively, ARQ has a beta of 2.05, indicating that its share price is 105% more volatile than the S&P 500.

Institutional and Insider Ownership

0.1% of 5N Plus shares are owned by institutional investors. Comparatively, 18.5% of ARQ shares are owned by institutional investors. 3.9% of 5N Plus shares are owned by insiders. Comparatively, 20.1% of ARQ shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Summary

5N Plus beats ARQ on 11 of the 15 factors compared between the two stocks.

About 5N Plus

5N Plus Inc. produces and sells specialty metals and chemicals in North America, Europe, and Asia. It operates through two segments, Specialty Semiconductors and Performance Materials. The company offers semiconductor compounds, semiconductor wafers, metals, epitaxial semiconductor substrates, and solar cells. It also provides active pharmaceutical ingredients, animal feed additives, specialized chemicals, commercial grade metals, alloys, engineered powders, and recycling services. The company serves renewable energy, security, space, pharmaceutical, medical imaging, manufacturing, electronic, consumer, and industrial application markets. 5N Plus Inc. is headquartered in Montreal, Canada.

About ARQ

Arq, Inc. is a holding company. It engages in the provision of environmental and emission control equipment to the power generation industry. The company operates through the following Segments: Refined Coal and Advanced Purification Technologies. The Refined Coal segment includes the Tinuum Group, Tinuum Services, and GWN Manager. The Advanced Purification Technologies segment refers to the sale of Activated Carbon Injection and Dry Sorbent Injection equipment systems, chemical sales, consulting services, and other sales related to the reduction of emissions in the coal-fired electric generation process and the electric utility industry. The company was founded in 1996 and is headquartered in Greenwood Village, CO.