Head to Head Analysis: Axalta Coating Systems (NYSE:AXTA) vs. NewMarket (NYSE:NEU)

Axalta Coating Systems (NYSE:AXTA) and NewMarket (NYSE:NEU) are both mid-cap basic materials companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, dividends, profitability, valuation, earnings, institutional ownership and risk.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Axalta Coating Systems and NewMarket, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Axalta Coating Systems	0	12	7	0	2.37
NewMarket	0	1	0	0	2.00

Axalta Coating Systems currently has a consensus price target of $36.56, indicating a potential upside of 6.02%. Given Axalta Coating Systems’ stronger consensus rating and higher probable upside, equities analysts plainly believe Axalta Coating Systems is more favorable than NewMarket.

Volatility & Risk

Axalta Coating Systems has a beta of 1.29, suggesting that its share price is 29% more volatile than the S&P 500. Comparatively, NewMarket has a beta of 0.48, suggesting that its share price is 52% less volatile than the S&P 500.

Valuation and Earnings

This table compares Axalta Coating Systems and NewMarket”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Axalta Coating Systems	$5.12 billion	1.44	$378.00 million	$1.74	19.82
NewMarket	$2.73 billion	2.10	$418.75 million	$44.42	13.71

NewMarket has lower revenue, but higher earnings than Axalta Coating Systems. NewMarket is trading at a lower price-to-earnings ratio than Axalta Coating Systems, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

98.3% of Axalta Coating Systems shares are owned by institutional investors. Comparatively, 61.1% of NewMarket shares are owned by institutional investors. 0.3% of Axalta Coating Systems shares are owned by insiders. Comparatively, 19.1% of NewMarket shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Axalta Coating Systems and NewMarket’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Axalta Coating Systems	7.39%	23.60%	7.07%
NewMarket	15.37%	25.38%	12.73%

About Axalta Coating Systems

Axalta Coating Systems Ltd., through its subsidiaries, manufactures, markets, and distributes high-performance coatings systems in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. The company operates through two segments, Performance Coatings and Mobility Coatings. It also offers water and solvent-borne products and systems to repair damaged vehicles for independent body shops, multi-shop operators, and original equipment manufacturer (OEM) dealership body shops. In addition, the company provides functional and decorative liquid, and powder coatings used in various industrial applications, including building materials, cabinet, wood and luxury vinyl flooring and furniture market under the Voltatex, AquaEC, Durapon, Hydropon, UNRIVALED, Ceranamel, Industrial, Corlar Industrial, Tufcote, Imron Industrial, Alesta, Teodur, Nap-Gard, Abcite, and Plascoat brands for powder coatings. Further, it develops and supplies electrocoat, primer, the basecoat, and clearcoat products for OEMs of light and commercial vehicles; and coatings systems for various commercial applications, including HDT, MDT, bus, and rail under the Imron, Imron Elite, Centari, Rival, Corlar epoxy undercoats, and AquaEC brands. The company offers products under the Audurra, Abcite, Alesta, AquaEC, Centari, Ceranamel, Challenger, Chemophan, ColorNet, Cromax, Cromax Mosaic, Durapon 70, Duxone, Harmonized Coating Technologies, Imron ExcelPro, Lutophen, Nason, Spies Hecker, Standox, Stollaquid, Syntopal, Syrox, Raptor, U-POL, and Vermeera brand names. The company was formerly known as Axalta Coating Systems Bermuda Co., Ltd. and changed its name to Axalta Coating Systems Ltd. in August 2014. Axalta Coating Systems Ltd. was founded in 1866 and is headquartered in Glen Mills, Pennsylvania.

About NewMarket

NewMarket Corporation, through its subsidiaries, primarily engages in the manufacture and sale of petroleum additives. The company offers lubricant additives for use in various vehicle and industrial applications, including engine oils, transmission fluids, off-road powertrain and hydraulic systems, gear oils, hydraulic oils, turbine oils, and other applications where metal-to-metal moving parts are utilized; engine oil additives designed for passenger cars, motorcycles, on and off-road heavy duty commercial equipment, locomotives, and engines in ocean-going vessels; driveline additives designed for products, such as transmission fluids, axle fluids, and off-road powertrain fluids; and industrial additives designed for products for industrial applications consisting of hydraulic fluids, grease, industrial gear fluids, and industrial specialty applications, such as turbine oils. It 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, and individual customers. In addition, the company engages in the marketing of antiknock compounds, as well as contracted manufacturing and services activities; and owns and manages a real property in Virginia. It operates in North America, Latin America, Asia Pacific, Europe, the Middle East, Africa, and India. NewMarket Corporation was founded in 1887 and is headquartered in Richmond, Virginia.