Hawkins (NASDAQ:HWKN) and Quaker Houghton (NYSE:KWR) Head-To-Head Review

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

Valuation and Earnings

This table compares Hawkins and Quaker Houghton”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hawkins	$1.08 billion	2.98	$81.55 million	$3.91	39.56
Quaker Houghton	$1.89 billion	1.31	-$2.49 million	$0.28	508.43

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

Analyst Recommendations

This is a summary of recent ratings and price targets for Hawkins and Quaker Houghton, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hawkins	0	2	2	0	2.50
Quaker Houghton	1	1	3	0	2.40

Hawkins presently has a consensus price target of $200.00, suggesting a potential upside of 29.29%. Quaker Houghton has a consensus price target of $166.00, suggesting a potential upside of 16.60%. Given Hawkins’ stronger consensus rating and higher probable upside, equities analysts plainly believe Hawkins is more favorable than Quaker Houghton.

Risk and Volatility

Hawkins has a beta of 0.76, suggesting that its share price is 24% less volatile than the S&P 500. Comparatively, Quaker Houghton has a beta of 1.43, suggesting that its share price is 43% more volatile than the S&P 500.

Dividends

Hawkins pays an annual dividend of $0.76 per share and has a dividend yield of 0.5%. Quaker Houghton pays an annual dividend of $2.03 per share and has a dividend yield of 1.4%. Hawkins pays out 19.4% of its earnings in the form of a dividend. Quaker Houghton pays out 725.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Hawkins has raised its dividend for 20 consecutive years and Quaker Houghton has raised its dividend for 17 consecutive years.

Profitability

This table compares Hawkins and Quaker Houghton’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hawkins	7.53%	16.08%	8.35%
Quaker Houghton	0.22%	9.03%	4.39%

Institutional and Insider Ownership

69.7% of Hawkins shares are owned by institutional investors. Comparatively, 77.5% of Quaker Houghton shares are owned by institutional investors. 4.1% of Hawkins shares are owned by company insiders. Comparatively, 1.0% of Quaker Houghton shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Hawkins beats Quaker Houghton on 11 of the 17 factors compared between the two stocks.

About Hawkins

Hawkins, Inc. operates as a specialty chemical and ingredients company in the United States. It operates through three segments: Industrial, Water Treatment, and Health and Nutrition. The Industrial segment offers industrial chemicals, products, and services to agriculture, chemical processing, electronics, energy, food, pharmaceutical, and plating industries. This segment manufactures sodium hypochlorite and agricultural products, as well as various food-grade and pharmaceutical products, such as liquid phosphates, lactates, other blended products, and agricultural products; and receives, stores, and distributes various chemicals comprising liquid caustic soda, sulfuric acid, hydrochloric acid, urea, phosphoric acid, aqua ammonia, and potassium hydroxide. It also repackages water treatment chemicals and bulk industrial chemicals; and performs custom blending of chemicals. The Water Treatment segment provides chemicals, products, equipment, services, and solutions for potable water, municipal and industrial wastewater, industrial process water, non-residential swimming pool water, and agriculture water. The Health and Nutrition segment offers ingredient distribution, processing, and formulation solutions to manufacturers of nutraceutical, functional food and beverage, personal care, dietary supplement and other nutritional food, and health and wellness products. Its products portfolio includes minerals, vitamins and amino acids, excipients, joint products, botanicals and herbs, sweeteners, and enzymes. Hawkins, Inc. was founded in 1938 and is headquartered in Roseville, Minnesota.

About Quaker Houghton

Quaker Chemical Corporation, together with its subsidiaries, develops, produces, and markets various formulated specialty chemical products for a range of heavy industrial and manufacturing applications in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. It offers metal removal fluids, cleaning fluids, corrosion inhibitors, metal drawing and forming fluids, die-cast mold releases, heat treatment and quenchants, metal forging fluids, hydraulic fluids, specialty greases, offshore sub-sea energy control fluids, rolling lubricants, rod and wire drawing fluids, and surface treatment chemicals. The company also provides chemical management services. It serves steel, aluminum, automotive, aerospace, offshore, container, mining, and metalworking companies. The company was founded in 1918 and is headquartered in Conshohocken, Pennsylvania.