Quaker Chemical Corporation (NYSE: KWR) and UFP Technologies (NASDAQ:UFPT) are both small-cap basic materials companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, dividends, profitability, valuation and risk.

Valuation & Earnings

This table compares Quaker Chemical Corporation and UFP Technologies’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Quaker Chemical Corporation $777.77 million 2.34 $106.55 million $3.93 34.81
UFP Technologies $148.67 million 1.31 $17.67 million $1.23 21.87

Quaker Chemical Corporation has higher revenue and earnings than UFP Technologies. UFP Technologies is trading at a lower price-to-earnings ratio than Quaker Chemical Corporation, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Quaker Chemical Corporation has a beta of 1.22, indicating that its stock price is 22% more volatile than the S&P 500. Comparatively, UFP Technologies has a beta of 0.18, indicating that its stock price is 82% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Quaker Chemical Corporation and UFP Technologies, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Quaker Chemical Corporation 0 1 0 0 2.00
UFP Technologies 0 0 0 0 N/A

Quaker Chemical Corporation currently has a consensus price target of $153.00, suggesting a potential upside of 11.83%. Given Quaker Chemical Corporation’s higher possible upside, equities research analysts clearly believe Quaker Chemical Corporation is more favorable than UFP Technologies.

Profitability

This table compares Quaker Chemical Corporation and UFP Technologies’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Quaker Chemical Corporation 6.73% 15.52% 9.26%
UFP Technologies 6.03% 6.86% 6.04%

Insider & Institutional Ownership

82.8% of Quaker Chemical Corporation shares are held by institutional investors. Comparatively, 68.2% of UFP Technologies shares are held by institutional investors. 3.6% of Quaker Chemical Corporation shares are held by insiders. Comparatively, 13.3% of UFP Technologies shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Dividends

Quaker Chemical Corporation pays an annual dividend of $1.42 per share and has a dividend yield of 1.0%. UFP Technologies does not pay a dividend. Quaker Chemical Corporation pays out 36.1% of its earnings in the form of a dividend. Quaker Chemical Corporation has raised its dividend for 7 consecutive years.

Summary

Quaker Chemical Corporation beats UFP Technologies on 13 of the 15 factors compared between the two stocks.

Quaker Chemical Corporation Company Profile

Quaker Chemical Corporation is a provider of process fluids, chemical specialties, and technical expertise to a range of industries, including steel, aluminum, mining, aerospace, tube and pipe, cans and others. The Company’s segments include North America, Europe, Middle East and Africa (EMEA), Asia/Pacific and South America. It develops, produces, and markets a range of formulated chemical specialty products and offers chemical management services. Its products and services include rolling lubricants (used by manufacturers of steel in the hot and cold rolling of steel and by manufacturers of aluminum in the hot rolling of aluminum); machining and grinding compounds (used by metalworking customers in cutting, shaping, and grinding metal parts, which require special treatment to enable them to tolerate the manufacturing process, achieve closer tolerance, and improve tool life), and hydraulic fluids (used by steel, metalworking, and other customers to operate hydraulic equipment).

UFP Technologies Company Profile

UFP Technologies, Inc. is a designer and custom converter of foams, plastics, composites and natural fiber materials. The Company is engaged in providing solutions to customers primarily within the medical, automotive, consumer, electronics, industrial, and aerospace and defense markets. It converts these materials using laminating, molding, and fabricating manufacturing technologies. The Company’s raw materials consist of polyethylene and polyurethane foams, sheet plastics, pulp fiber, cross-linked polyethylene and reticulated polyurethane foams, fabric and foam laminates, and natural fiber materials. The Company converts these materials to provide customers various solutions, including automotive interior trim, medical device components, disposable wound care components, military uniform and gear components, athletic padding, air filtration, high-temperature insulation, abrasive nail files and other beauty aids, and cushion packaging for their products.

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