LyondellBasell Industries (NYSE:LYB) versus Huntsman (NYSE:HUN) Head to Head Review

Huntsman (NYSE:HUN) and LyondellBasell Industries (NYSE:LYB) are both basic materials companies, but which is the superior business? We will compare the two companies based on the strength of their risk, analyst recommendations, valuation, profitability, earnings, institutional ownership and dividends.

Risk & Volatility

Huntsman has a beta of 0.7, suggesting that its stock price is 30% less volatile than the S&P 500. Comparatively, LyondellBasell Industries has a beta of 0.7, suggesting that its stock price is 30% less volatile than the S&P 500.

Dividends

Huntsman pays an annual dividend of $0.35 per share and has a dividend yield of 2.5%. LyondellBasell Industries pays an annual dividend of $5.48 per share and has a dividend yield of 9.2%. Huntsman pays out -18.4% of its earnings in the form of a dividend. LyondellBasell Industries pays out -235.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Huntsman has increased its dividend for 4 consecutive years and LyondellBasell Industries has increased its dividend for 14 consecutive years. LyondellBasell Industries is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Huntsman and LyondellBasell Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Huntsman	-5.69%	-3.26%	-1.41%
LyondellBasell Industries	-2.46%	4.94%	1.60%

Earnings and Valuation

This table compares Huntsman and LyondellBasell Industries”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Huntsman	$5.78 billion	0.42	-$189.00 million	($1.90)	-7.40
LyondellBasell Industries	$30.15 billion	0.63	-$738.00 million	($2.33)	-25.49

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

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Huntsman and LyondellBasell Industries, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Huntsman	4	8	2	0	1.86
LyondellBasell Industries	5	17	1	0	1.83

Huntsman currently has a consensus price target of $11.00, suggesting a potential downside of 21.79%. LyondellBasell Industries has a consensus price target of $51.00, suggesting a potential downside of 14.13%. Given LyondellBasell Industries’ higher possible upside, analysts plainly believe LyondellBasell Industries is more favorable than Huntsman.

Institutional & Insider Ownership

84.8% of Huntsman shares are owned by institutional investors. Comparatively, 71.2% of LyondellBasell Industries shares are owned by institutional investors. 6.2% of Huntsman shares are owned by insiders. Comparatively, 0.1% of LyondellBasell Industries 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.

Summary

LyondellBasell Industries beats Huntsman on 9 of the 16 factors compared between the two stocks.

About Huntsman

Huntsman Corporation manufactures and sells diversified organic chemical products worldwide. The company operates in three segments: Polyurethanes, Performance Products, and Advanced Materials. The Polyurethanes segment offers polyurethane chemicals, including methyl diphenyl diisocyanate, polyether and polyester polyols, and thermoplastic polyurethane; and aniline, benzene, nitrobenzene and other co-products. The Performance Products segment manufactures amines, such as polyetheramines, ethyleneamines, DGA Agent, JEFFCAT catalysts, and E-GRADE specialty amines and carbonates; and maleic anhydrides. The Advanced Materials segment offers epoxy, phenoxy, acrylic, polyurethane, and acrylonitrile-butadiene-based polymer formulations; and thermoset resins, curing and toughening agents, and carbon nanomaterials. The company provides pre-and post-sales technical service support to customers. Its products are used in a range of applications, including adhesives, aerospace, automotive, construction products, durable and non-durable consumer products, electronics, insulation, packaging, coatings and construction, power generation, and refining, as well as serves the elastomers, insulation, footwear, furniture, industrial, oil and gas, liquid natural gas transport, printed circuit boards, consumer, appliances, electrical power transmission and distribution, recreational sports equipment, and medical appliances markets. The company sells its products through a network of distributors and agents. Huntsman Corporation was founded in 1970 and is headquartered in The Woodlands, Texas.

About LyondellBasell Industries

LyondellBasell Industries N.V. operates as a chemical company in the United States, Germany, Mexico, Italy, Poland, France, Japan, China, the Netherlands, and internationally. The company operates in six segments: Olefins and PolyolefinsAmericas; Olefins and PolyolefinsEurope, Asia, International; Intermediates and Derivatives; Advanced Polymer Solutions; Refining; and Technology. It produces and markets olefins and co-products, polyethylene, and polypropylene; and propylene oxide and derivatives; oxyfuels and related products; and intermediate chemicals, such as styrene monomer, acetyls, ethylene oxide, and ethylene glycol. In addition, the company produce and markets compounding and solutions including polypropylene compounds, engineered plastics, masterbatches, engineered composites, colors and powders, and advanced polymers including catalloy and polybutene-1; and refines heavy, high-sulfur crude oil and other crude oils, as well as refined products, including gasoline and distillates. Further, it develops and licenses chemical and polyolefin process technologies; manufactures and sells polyolefin catalysts; and serves food packaging, home furnishings, automotive components, and paints and coatings applications. LyondellBasell Industries N.V. was incorporated in 2009 and is headquartered in Houston, Texas.