Financial Survey: Platform Specialty Products (PAH) and Kraton (KRA)
Platform Specialty Products (NYSE: PAH) and Kraton (NYSE:KRA) are both basic materials companies, but which is the better stock? We will compare the two businesses based on the strength of their analyst recommendations, valuation, institutional ownership, risk, profitability, dividends and earnings.
Risk and Volatility
Platform Specialty Products has a beta of 3.19, suggesting that its share price is 219% more volatile than the S&P 500. Comparatively, Kraton has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500.
This table compares Platform Specialty Products and Kraton’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Platform Specialty Products||-4.12%||7.45%||2.15%|
This is a summary of recent ratings and recommmendations for Platform Specialty Products and Kraton, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Platform Specialty Products||0||3||6||0||2.67|
Platform Specialty Products currently has a consensus target price of $13.11, suggesting a potential upside of 24.16%. Kraton has a consensus target price of $60.00, suggesting a potential upside of 18.11%. Given Platform Specialty Products’ higher possible upside, analysts plainly believe Platform Specialty Products is more favorable than Kraton.
Insider and Institutional Ownership
93.5% of Platform Specialty Products shares are held by institutional investors. Comparatively, 97.5% of Kraton shares are held by institutional investors. 5.2% of Platform Specialty Products shares are held by company insiders. Comparatively, 4.7% of Kraton shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Earnings and Valuation
This table compares Platform Specialty Products and Kraton’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Platform Specialty Products||$3.59 billion||0.85||-$73.70 million||($0.53)||-19.92|
|Kraton||$1.74 billion||0.91||$107.30 million||$0.76||66.84|
Kraton has lower revenue, but higher earnings than Platform Specialty Products. Platform Specialty Products is trading at a lower price-to-earnings ratio than Kraton, indicating that it is currently the more affordable of the two stocks.
Kraton beats Platform Specialty Products on 8 of the 13 factors compared between the two stocks.
About Platform Specialty Products
Platform Specialty Products Corporation produces and sells specialty chemical products in the Americas, the Asia-Pacific, and Europe. It operates through two segments, Performance Solutions and Agricultural Solutions. The Performance Solutions segment offers plating products that are used to plate holes; electroless nickel products, which are applied to various metal and plastic surfaces; electronic assembly materials for use in the electronic market and residential boiler systems; final finishes that are used on printed circuit boards; circuit formation products for surface preparation; oxides, which are used in the fabrication of multilayer circuit boards; semiconductor materials and packaging products; and pre-treatment and cleaning solutions. This segment also provides functional conversion coatings that are applied to metals to enhance corrosion resistance and paint adhesion; hard-coated films, which are used for the membrane switch in the touch screen markets; production and drilling fluids used in subsea control systems; solid sheet printing elements for use in flexographic printing and platemaking processes; liquid products to produce printing plates; and printing equipment. The Agricultural Solutions segment offers fungicides and biofungicides to prevent the spread of fungi and other diseases in crops; herbicides to control unwanted plants; insecticides, bioinsecticides, and acaricides; biostimulants and nutrition products; and seed treatment products, which are applied to seed before planting, as well as animal health products, such as honey bee protective miticides and veterinary vaccines. The company was formerly known as Platform Acquisition Holdings Limited and changed its name to Platform Specialty Products Corporation in October 2013. Platform Specialty Products Corporation was founded in 1922 and is headquartered in West Palm Beach, Florida.
Kraton Corporation, formerly Kraton Performance Polymers, Inc., is a specialty chemicals company. The Company manufactures styrenic block copolymers (SBCs) and other engineered polymers. The Company also produces specialty products primarily derived from pine wood pulping co-products. The Company operates through two segments: Polymer Segment, which comprises SBCs and other engineered polymers business, and Chemical Segment, which comprises pine-based specialty products business. Its SBCs are used in a range of applications, including adhesives, coatings, consumer and personal care products, sealants, lubricants, medical, packaging, automotive, paving, roofing and footwear products. The Company also sells isoprene rubber (IR) and isoprene rubber latex (IRL), which are non-SBC products primarily used in applications, such as medical products, personal care, adhesives, tackifiers, paints and coatings. It offers crude tall oil (CTO) and crude sulfate turpentine (CST).
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