Pacific Ethanol (PEIX) and NewMarket (NEU) Financial Contrast

Pacific Ethanol (NASDAQ: PEIX) and NewMarket (NYSE:NEU) are both oils/energy companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, risk, earnings, profitability, institutional ownership, dividends and analyst recommendations.

Valuation & Earnings

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This table compares Pacific Ethanol and NewMarket’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Pacific Ethanol $1.63 billion 0.09 -$34.96 million ($0.85) -4.00
NewMarket $2.20 billion 2.21 $190.50 million N/A N/A

NewMarket has higher revenue and earnings than Pacific Ethanol.

Analyst Ratings

This is a summary of current ratings for Pacific Ethanol and NewMarket, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Pacific Ethanol 0 0 3 0 3.00
NewMarket 0 0 0 0 N/A

Pacific Ethanol currently has a consensus price target of $11.33, indicating a potential upside of 233.33%. Given Pacific Ethanol’s higher probable upside, research analysts plainly believe Pacific Ethanol is more favorable than NewMarket.

Dividends

NewMarket pays an annual dividend of $7.00 per share and has a dividend yield of 1.7%. Pacific Ethanol does not pay a dividend. NewMarket has raised its dividend for 9 consecutive years.

Profitability

This table compares Pacific Ethanol and NewMarket’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Pacific Ethanol -2.14% -8.84% -4.96%
NewMarket 8.67% 37.86% 13.43%

Insider & Institutional Ownership

78.3% of Pacific Ethanol shares are owned by institutional investors. Comparatively, 55.7% of NewMarket shares are owned by institutional investors. 3.9% of Pacific Ethanol shares are owned by insiders. Comparatively, 16.9% of NewMarket shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Volatility & Risk

Pacific Ethanol has a beta of 2.05, meaning that its stock price is 105% more volatile than the S&P 500. Comparatively, NewMarket has a beta of 0.74, meaning that its stock price is 26% less volatile than the S&P 500.

Summary

NewMarket beats Pacific Ethanol on 10 of the 14 factors compared between the two stocks.

Pacific Ethanol Company Profile

Pacific Ethanol, Inc. produces and markets low-carbon renewable fuels in the United States. The company operates in two segments, Production and Marketing. It produces and markets ethanol; specialty alcohols; and co-products, such as wet distillers grains, dry distillers grains with solubles, wet and dry corn gluten feed, condensed distillers solubles, corn gluten meal, corn germ, corn oil, distillers yeast, and CO2, as well as markets ethanol produced by third parties. The company also offers ethanol transportation, storage, and delivery services through third-party service providers. It sells ethanol to integrated oil companies and gasoline marketers; distillers grains and other feed co-products to dairies and feedlots; and corn oil to poultry and biodiesel customers. The company owns and operates nine ethanol production facilities in the Western states of California, Oregon, and Idaho; and in the Midwestern states of Illinois and Nebraska. Pacific Ethanol, Inc. was founded in 2003 and is headquartered in Sacramento, California.

NewMarket Company Profile

NewMarket Corporation, through its subsidiaries, engages in the petroleum additives businesses. It offers lubricant additives for use in various vehicle and industrial applications, such as engine oils, transmission fluids, off-road powertrain and hydraulic systems, gear oils, hydraulic oils, turbine oils, metalworking fluids, and in other applications where metal-to-metal moving parts are utilized; and engine oil, driveline, and industrial additives. The company also provides fuel additives that are used to enhance the oil refining process and the performance of gasoline, diesel, biofuels, and other fuels to industry, government, original equipment manufacturers (OEMs), and individual customers. It has operations in the United States, Canada, Europe, the Asia Pacific, India, Latin America, and the Middle East. NewMarket Corporation was founded in 1887 and is headquartered in Richmond, Virginia.

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