Analyzing Sociedad Quimica y Minera (NYSE:SQM) and Westlake Chemical Partners (NYSE:WLKP)

Sociedad Quimica y Minera (NYSE:SQM) and Westlake Chemical Partners (NYSE:WLKP) are both basic materials companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, profitability, risk, earnings, dividends and institutional ownership.

Profitability

This table compares Sociedad Quimica y Minera and Westlake Chemical Partners’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sociedad Quimica y Minera	12.85%	9.69%	4.78%
Westlake Chemical Partners	4.69%	7.10%	4.53%

Risk and Volatility

Sociedad Quimica y Minera has a beta of 1, suggesting that its share price has a similar volatility profile to the S&P 500.Comparatively, Westlake Chemical Partners has a beta of 0.52, suggesting that its share price is 48% less volatile than the S&P 500.

Valuation & Earnings

This table compares Sociedad Quimica y Minera and Westlake Chemical Partners”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sociedad Quimica y Minera	$4.58 billion	5.70	$588.14 million	$2.05	44.56
Westlake Chemical Partners	$1.17 billion	0.70	$48.70 million	$1.64	14.22

Sociedad Quimica y Minera has higher revenue and earnings than Westlake Chemical Partners. Westlake Chemical Partners is trading at a lower price-to-earnings ratio than Sociedad Quimica y Minera, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations for Sociedad Quimica y Minera and Westlake Chemical Partners, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sociedad Quimica y Minera	1	7	5	1	2.43
Westlake Chemical Partners	0	2	0	0	2.00

Sociedad Quimica y Minera presently has a consensus price target of $71.42, indicating a potential downside of 21.82%. Given Sociedad Quimica y Minera’s stronger consensus rating and higher probable upside, research analysts clearly believe Sociedad Quimica y Minera is more favorable than Westlake Chemical Partners.

Insider and Institutional Ownership

12.4% of Sociedad Quimica y Minera shares are held by institutional investors. Comparatively, 78.3% of Westlake Chemical Partners shares are held by institutional investors. 1.1% of Westlake Chemical Partners shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Dividends

Sociedad Quimica y Minera pays an annual dividend of $2.68 per share and has a dividend yield of 2.9%. Westlake Chemical Partners pays an annual dividend of $1.89 per share and has a dividend yield of 8.1%. Sociedad Quimica y Minera pays out 130.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Westlake Chemical Partners pays out 115.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Westlake Chemical Partners is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Sociedad Quimica y Minera beats Westlake Chemical Partners on 13 of the 17 factors compared between the two stocks.

About Sociedad Quimica y Minera

Sociedad Química y Minera de Chile S.A. operates as a mining company worldwide. The company offers specialty plant nutrients, including sodium potassium nitrate, specialty blends, and other specialty fertilizers under Ultrasol, Qrop, Speedfol, Allganic, Ultrasoline, ProP, and Prohydric brands. It also provides iodine and its derivatives for use in medical, agricultural, industrial, and human and animal nutrition products comprising x-ray contrast media, biocides, antiseptics and disinfectants, pharmaceutical intermediates, polarizing films for LCD and LED screens, chemicals, organic compounds, and pigments, as well as added to edible salt to prevent iodine deficiency disorders. In addition, the company produces lithium carbonate and lithium hydroxide which are used in the production of cathode material for secondary batteries; lithium chloride; and basic lithium chemicals and lithium derivatives used in lubricating greases for heat-resistant glass, chips for the ceramic and glazing industry, and air conditioning chemicals, as well as other pharmaceutical syntheses and metal alloys. Further, it produces potassium sulfate; and potassium chloride which is used as a fertilizer for the application of potassium to different crops. Additionally, the company produces and markets industrial chemicals, such as sodium nitrate mainly used in the production of glass and explosives, metal processing and recycling, and production of insulating materials and adhesives; potassium nitrate used as a raw material to produce frits and special glass, as well as in the enamel, metal treatment, and pyrotechnic sectors; solar salts used as a thermal storage medium in solar power generation plants; and potassium chloride as an additive in oil drilling and food processing sectors. Furthermore, it is involved in the commercialization of third-party fertilizers; and exploration of copper, gold, and silver deposits. The company was founded in 1926 and is headquartered in Santiago, Chile.

About Westlake Chemical Partners

Westlake Chemical Partners LP acquires, develops, and operates ethylene production facilities and related assets in the United States. The company’s ethylene production facilities primarily convert ethane into ethylene. It also sells ethylene co-products, such as propylene, crude butadiene, pyrolysis gasoline, and hydrogen directly to third parties on either a spot or contract basis. Westlake Chemical Partners GP LLC serves as the general partner of the company. Westlake Chemical Partners LP was founded in 1991 and is headquartered in Houston, Texas.