Analyzing Cabot (CBT) and Cytec Industries (NYSE:CYT)

Cytec Industries (NYSE: CYT) and Cabot (NYSE:CBT) are both mid-cap specialty chemicals – nec companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, risk, valuation, earnings, profitability and institutional ownership.

Earnings and Valuation

This table compares Cytec Industries and Cabot’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Cytec Industries N/A N/A N/A $1.78 42.23
Cabot $2.72 billion 1.31 $241.00 million $3.81 15.10

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

Insider and Institutional Ownership

84.8% of Cabot shares are held by institutional investors. 2.5% of Cabot shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings for Cytec Industries and Cabot, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cytec Industries 0 0 0 0 N/A
Cabot 0 3 4 0 2.57

Cabot has a consensus target price of $61.33, indicating a potential upside of 6.59%. Given Cabot’s higher possible upside, analysts plainly believe Cabot is more favorable than Cytec Industries.

Dividends

Cabot pays an annual dividend of $1.26 per share and has a dividend yield of 2.2%. Cytec Industries does not pay a dividend. Cabot pays out 33.1% of its earnings in the form of a dividend. Cytec Industries has raised its dividend for 3 consecutive years and Cabot has raised its dividend for 5 consecutive years.

Profitability

This table compares Cytec Industries and Cabot’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cytec Industries 11.96% 18.60% 8.55%
Cabot 8.87% 15.11% 6.95%

Summary

Cabot beats Cytec Industries on 8 of the 12 factors compared between the two stocks.

About Cytec Industries

Cytec Industries Inc. is a global specialty materials and chemicals company focused on developing, manufacturing and selling value-added products. The Company offers aerospace and industrial materials, mining and plastics industries. The Company operates through four segments: Aerospace Materials, Industrial Materials, In Process Separation, and Additive Technologies. The Aerospace Materials segment includes advanced composites, carbon fiber, and structural film adhesives. The Industrial Materials segment includes structural composite materials, which serve automotive, motorsports, recreation, tooling, and other structural materials markets and process materials, which serves aerospace, wind energy, and other process materials markets. The In Process Separation segment includes mining chemicals and phosphines. The Additive Technologies segment includes polymer additives, specialty additives, and formulated resins. The Company operates as a wholly owned subsidiary of Solvay.

About Cabot

Cabot Corporation is a global specialty chemicals and performance materials company. The Company operates through four business segments: reinforcement materials, performance chemicals, purification solutions and specialty fluids. Reinforcement materials’ rubber grade carbon blacks are used to enhance the physical properties of the systems and applications in which they are incorporated. Its rubber blacks products are used in tires and industrial products. Performance Chemicals consists of two businesses: specialty carbons and formulations business, and metal oxides business. Purification Solutions’ activated carbon products are used for the purification of water, air and pharmaceuticals, among others, as either a colorant or a decolorizing agent in the production of food and beverage applications. Its specialty fluids segment produces and markets cesium formate as a drilling and completion fluid for use in high pressure and high temperature oil and gas well construction.

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