Critical Analysis: Sociedad Quimica y Minera (NYSE:SQM) and Givaudan (OTCMKTS:GVDNY)

Givaudan (OTCMKTS:GVDNY) and Sociedad Quimica y Minera (NYSE:SQM) are both large-cap basic materials companies, but which is the superior business? We will compare the two companies based on the strength of their profitability, valuation, earnings, institutional ownership, analyst recommendations, risk and dividends.

Dividends

Givaudan pays an annual dividend of $0.95 per share and has a dividend yield of 1.1%. Sociedad Quimica y Minera pays an annual dividend of $0.14 per share and has a dividend yield of 0.3%. Sociedad Quimica y Minera pays out 8.4% of its earnings in the form of a dividend.

Insider & Institutional Ownership

0.0% of Givaudan shares are owned by institutional investors. Comparatively, 12.4% of Sociedad Quimica y Minera shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Givaudan and Sociedad Quimica y Minera”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Givaudan	$8.42 billion	4.72	$1.24 billion	N/A	N/A
Sociedad Quimica y Minera	$4.23 billion	3.57	$685.12 million	$1.67	31.61

Givaudan has higher revenue and earnings than Sociedad Quimica y Minera.

Risk & Volatility

Givaudan has a beta of 0.73, meaning that its stock price is 27% less volatile than the S&P 500. Comparatively, Sociedad Quimica y Minera has a beta of 1.14, meaning that its stock price is 14% more volatile than the S&P 500.

Profitability

This table compares Givaudan and Sociedad Quimica y Minera’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Givaudan	N/A	N/A	N/A
Sociedad Quimica y Minera	11.29%	9.09%	4.17%

Analyst Recommendations

This is a breakdown of current ratings and target prices for Givaudan and Sociedad Quimica y Minera, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Givaudan	0	1	1	1	3.00
Sociedad Quimica y Minera	2	6	3	0	2.09

Sociedad Quimica y Minera has a consensus target price of $46.81, indicating a potential downside of 11.33%. Given Sociedad Quimica y Minera’s higher probable upside, analysts plainly believe Sociedad Quimica y Minera is more favorable than Givaudan.

About Givaudan

Givaudan SA manufactures, supplies, and sells fragrance, beauty, taste, and wellbeing products to the consumer goods industry. The company operates through divisions, Fragrance & Beauty, and Taste & Wellbeing. The Fragrance & Beauty division offers fine fragrances; consumer products, such as personal, home, fabric, and oral care; fragrance ingredients; and active beauty products. The Taste & Wellbeing division provides beverages, such as fizzy drinks, bottled waters, ready-to-drink juices, alcoholic beverages, and others; dairy and cheese products, including dairy drinks, yoghurt, ice cream, chilled desserts, cream cheese, and spreads; snacks; givaudan flavour ingredients; savory, and supplements and nutraceutical products; and biscuits, crackers, and cereals, as well as confectionery products, such as chewing gums, chocolates, and sweets. It operates in Switzerland, Europe, Africa, the Middle East, North America, Latin America, and the Asia Pacific. Givaudan SA was founded in 1796 and is headquartered in Vernier, Switzerland.

About Sociedad Quimica y Minera

Sociedad Química y Minera de Chile S.A. operates as a mining company worldwide. The company offers specialty plant nutrients, including sodium potassium nitrate, specialty blends, and other specialty fertilizers under Ultrasol, Qrop, Speedfol, Allganic, Ultrasoline, ProP, and Prohydric brands. It also provides iodine and its derivatives for use in medical, agricultural, industrial, and human and animal nutrition products comprising x-ray contrast media, biocides, antiseptics and disinfectants, pharmaceutical intermediates, polarizing films for LCD and LED screens, chemicals, organic compounds, and pigments, as well as added to edible salt to prevent iodine deficiency disorders. In addition, the company produces lithium carbonate and lithium hydroxide which are used in the production of cathode material for secondary batteries; lithium chloride; and basic lithium chemicals and lithium derivatives used in lubricating greases for heat-resistant glass, chips for the ceramic and glazing industry, and air conditioning chemicals, as well as other pharmaceutical syntheses and metal alloys. Further, it produces potassium sulfate; and potassium chloride which is used as a fertilizer for the application of potassium to different crops. Additionally, the company produces and markets industrial chemicals, such as sodium nitrate mainly used in the production of glass and explosives, metal processing and recycling, and production of insulating materials and adhesives; potassium nitrate used as a raw material to produce frits and special glass, as well as in the enamel, metal treatment, and pyrotechnic sectors; solar salts used as a thermal storage medium in solar power generation plants; and potassium chloride as an additive in oil drilling and food processing sectors. Furthermore, it is involved in the commercialization of third-party fertilizers; and exploration of copper, gold, and silver deposits. The company was founded in 1926 and is headquartered in Santiago, Chile.