Gulf Resources (NASDAQ:GURE – Get Free Report) and Sumitomo Chemcl (OTCMKTS:SOMMY – Get Free Report) are both basic materials companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, dividends, analyst recommendations, earnings and profitability.
Risk and Volatility
Gulf Resources has a beta of 0.26, suggesting that its share price is 74% less volatile than the S&P 500. Comparatively, Sumitomo Chemcl has a beta of 0.28, suggesting that its share price is 72% less volatile than the S&P 500.
Earnings & Valuation
This table compares Gulf Resources and Sumitomo Chemcl”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Gulf Resources | $7.66 million | 0.83 | -$58.94 million | ($25.00) | -0.19 |
| Sumitomo Chemcl | $17.12 billion | 0.29 | $254.70 million | $0.17 | 87.41 |
Sumitomo Chemcl has higher revenue and earnings than Gulf Resources. Gulf Resources is trading at a lower price-to-earnings ratio than Sumitomo Chemcl, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of current ratings and price targets for Gulf Resources and Sumitomo Chemcl, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Gulf Resources | 1 | 0 | 0 | 0 | 1.00 |
| Sumitomo Chemcl | 0 | 1 | 0 | 0 | 2.00 |
Profitability
This table compares Gulf Resources and Sumitomo Chemcl’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Gulf Resources | -195.79% | -18.32% | -15.71% |
| Sumitomo Chemcl | 0.35% | 0.80% | 0.25% |
Institutional & Insider Ownership
3.3% of Gulf Resources shares are held by institutional investors. 3.2% of Gulf Resources shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Summary
Sumitomo Chemcl beats Gulf Resources on 9 of the 12 factors compared between the two stocks.
About Gulf Resources
Gulf Resources, Inc., through its subsidiaries, manufactures and trades bromine and crude salt, chemical products, and natural gas in the People’s Republic of China. The company operates through four segments: Bromine, Crude salt, Chemical products, and Natural gas segments. It also provides bromine for use in bromine compounds, intermediates in organic synthesis, brominated flame retardants, fumigants, water purification compounds, dyes, medicines, and disinfectants. In addition, the company offers crude salt for use as a material in alkali and chlorine alkali production for use in the chemical, food and beverage, and other industries. In addition, it manufactures and sells chemical products for use in oil and gas field exploration, oil and gas distribution, oil field drilling, papermaking chemical agents, and inorganic chemicals, as well as materials that are used for human and animal antibiotics. The company is based in Shouguang, the People’s Republic of China.
About Sumitomo Chemcl
Sumitomo Chemical Company, Limited engages in Chemicals & Plastics, energy and functional materials, IT-related chemicals, health and crop sciences, pharmaceuticals, and other businesses worldwide. Its Essential Chemicals & Plastics segment offers synthetic resins, such as polyethylene, polypropylene, and polymethyl methacrylate resins; raw materials for synthetic fibers; and various industrial chemicals. The company's Energy & Functional Materials segment provides alumina and aluminum products used for energy products; resorcinol for tires, wood adhesives, flame retardants, and ultraviolet ray absorbants; polymer additives and rubber chemicals; synthetic rubber for tires, shoes, construction materials, and other applications; and engineering plastics and lithium-ion secondary battery materials for use in electronic components and next-generation vehicles. Its IT-Related Chemicals segment provides polarizing films, touch screen sensor panels, and color resists and polymer OLED for LC and OLED displays; photoresists and high-purity chemicals for the semiconductor manufacturing process; and compound semiconductor materials for antenna switches and other components of communication terminal equipment. The company's Health & Crop Sciences segment offers crop protection chemicals, fertilizers, feed additives, and household insecticides; active pharmaceutical ingredients and intermediates; and products to control infectious diseases. Its Pharmaceuticals segment provides prescription and diagnostic pharmaceuticals. The company's Others segment supplies electric power and steam; designs, constructs, and supervises chemical plants; provides transportation and warehousing services; and conducts physical property and environmental analysis. Sumitomo Chemical Company, Limited was founded in 1913 and is headquartered in Tokyo, Japan.
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