Oil-Dri Corporation Of America (NYSE:ODC) & Innospec (NASDAQ:IOSP) Financial Review

Oil-Dri Corporation Of America (NYSE:ODC) and Innospec (NASDAQ:IOSP) are both small-cap basic materials companies, but which is the better business? We will contrast the two companies based on the strength of their risk, profitability, earnings, dividends, analyst recommendations, valuation and institutional ownership.

Institutional & Insider Ownership

49.0% of Oil-Dri Corporation Of America shares are owned by institutional investors. Comparatively, 96.6% of Innospec shares are owned by institutional investors. 11.7% of Oil-Dri Corporation Of America shares are owned by company insiders. Comparatively, 1.3% of Innospec shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

Oil-Dri Corporation Of America pays an annual dividend of $0.72 per share and has a dividend yield of 1.3%. Innospec pays an annual dividend of $1.68 per share and has a dividend yield of 2.3%. Oil-Dri Corporation Of America pays out 19.5% of its earnings in the form of a dividend. Innospec pays out 215.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Oil-Dri Corporation Of America has increased its dividend for 11 consecutive years and Innospec has increased its dividend for 11 consecutive years.

Profitability

This table compares Oil-Dri Corporation Of America and Innospec’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Oil-Dri Corporation Of America	11.12%	22.36%	14.74%
Innospec	1.08%	10.89%	7.70%

Volatility and Risk

Oil-Dri Corporation Of America has a beta of 0.7, suggesting that its stock price is 30% less volatile than the S&P 500. Comparatively, Innospec has a beta of 1.04, suggesting that its stock price is 4% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations for Oil-Dri Corporation Of America and Innospec, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Oil-Dri Corporation Of America	0	0	1	0	3.00
Innospec	1	1	0	1	2.33

Valuation & Earnings

This table compares Oil-Dri Corporation Of America and Innospec”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Oil-Dri Corporation Of America	$485.57 million	1.66	$54.00 million	$3.70	14.89
Innospec	$1.85 billion	0.98	$35.60 million	$0.78	93.72

Oil-Dri Corporation Of America has higher earnings, but lower revenue than Innospec. Oil-Dri Corporation Of America is trading at a lower price-to-earnings ratio than Innospec, indicating that it is currently the more affordable of the two stocks.

Summary

Oil-Dri Corporation Of America beats Innospec on 10 of the 16 factors compared between the two stocks.

About Oil-Dri Corporation Of America

Oil-Dri Corporation of America is a manufacturer and supplier of specialty sorbent products for the pet care, animal health and nutrition, fluids purification, agricultural ingredients, sports field, industrial and automotive markets. It operates through the Business to Business Products Group and Retail and Wholesale Products Group segments. The Business to Business Products Group segment’s customers include processors and refiners of edible oils, jet fuel and biofuel, manufacturers of animal feed and agricultural chemicals, distributors of animal health and nutrition products, and marketers of consumer products. The Retail and Wholesale Products Group segment customers include retailers of cat litter and related accessories such as mass merchandisers, drugstore chains, pet specialty retail outlets, dollar stores, retail grocery stores as well as distributors of industrial cleanup and automotive products, environmental service companies, and sports field product users. The company was founded by Nick Jaffee in 1941 and is headquartered in Chicago, IL.

About Innospec

Innospec Inc. develops, manufactures, blends, markets, and supplies specialty chemicals in the United States, rest of North America, the United Kingdom, rest of Europe, and internationally. The company's Fuel Specialties segment offers a range of specialty chemical products that are used as additives in additives in diesel, jet, marine, fuel oil and other fuels. This segment's products are used in the operation of commercial trucking, marine and aviation engines, power station generators, heating oil, and other industrial machinery applications. Its Performance Chemicals segment provides technology-based solutions for its customers' processes or products that focuses on the personal care, home care, agrochemical, construction, mining, and other industrial markets. The company's Oilfield Services segment develops and markets chemical solutions for drilling, completion, fracturing, stimulation, and completion operations; and products for oil and gas production. It sells its products primarily to oil and gas exploration and production companies, oil refineries, fuel manufacturers and users, personal care and home care companies, formulators of agrochemical, and other chemical and industrial companies. The company was formerly known as Octel Corp. and changed its name to Innospec Inc. in January 2006. Innospec Inc. was founded in 1938 and is headquartered in Englewood, Colorado.