Basf (OTCMKTS:BASFY) and Sociedad Quimica y Minera (NYSE:SQM) Head to Head Analysis

Sociedad Quimica y Minera (NYSE:SQM) and Basf (OTCMKTS:BASFY) are both large-cap materials companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, dividends, analyst recommendations, risk, institutional ownership, earnings and valuation.

Insider and Institutional Ownership

12.4% of Sociedad Quimica y Minera shares are held by institutional investors. Comparatively, 0.0% of Basf shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Sociedad Quimica y Minera and Basf’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sociedad Quimica y Minera	20.62%	19.08%	9.90%
Basf	9.40%	5.78%	2.56%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Sociedad Quimica y Minera and Basf, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sociedad Quimica y Minera	1	8	5	1	2.40
Basf	1	3	4	1	2.56

Sociedad Quimica y Minera presently has a consensus target price of $75.27, indicating a potential downside of 8.34%. Given Sociedad Quimica y Minera’s higher probable upside, research analysts plainly believe Sociedad Quimica y Minera is more favorable than Basf.

Valuation and Earnings

This table compares Sociedad Quimica y Minera and Basf”s gross 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	5.13	$588.14 million	$4.85	16.93
Basf	$67.48 billion	0.80	$1.83 billion	$1.94	7.78

Basf has higher revenue and earnings than Sociedad Quimica y Minera. Basf 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.

Dividends

Sociedad Quimica y Minera pays an annual dividend of $2.65 per share and has a dividend yield of 3.2%. Basf pays an annual dividend of $0.47 per share and has a dividend yield of 3.1%. Sociedad Quimica y Minera pays out 54.6% of its earnings in the form of a dividend. Basf pays out 24.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Risk and Volatility

Sociedad Quimica y Minera has a beta of 0.98, suggesting that its stock price is 2% less volatile than the S&P 500. Comparatively, Basf has a beta of 0.73, suggesting that its stock price is 27% less volatile than the S&P 500.

Summary

Sociedad Quimica y Minera beats Basf on 11 of the 15 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 Basf

BASF SE operates as a chemical company worldwide. It operates through six segments: Chemicals, Materials, Industrial Solutions, Surface Technologies, Nutrition & Care, and Agricultural Solutions. The Chemicals segment provides petrochemicals and intermediates. The Materials segment offers advanced materials and their precursors for applications and systems comprising isocyanates, polyamides, and inorganic basic products, as well as specialties for plastics and plastics processing industries. The Industrial Solutions segment develops and markets ingredients and additives for industrial applications, such as polymer dispersions, resins, additives, electronic materials, and antioxidants for automotive, plastics, paints and coatings, electronics, and energy and resource industries. The Surface Technologies segment provides automotive OEM and refinish coatings, surface treatment, catalysts, battery materials, and precious and base metal services for the automotive and chemical sectors. The Nutrition & Care segment offers ingredients for consumer goods in the areas of nutrition, home, personal care, and technical applications; and serves the food and feed producers, pharmaceutical, cosmetics, detergents, cleaners, and crop protection industries, as well as fast-moving consumer goods sector. The Agricultural Solutions segment provides seeds and seed treatment products; fungicides, herbicides, insecticides, and biological crop protection products; and digital farming solutions. The company engages in engineering and other; rental and leasing; and commodity trading activities. BASF SE was founded in 1865 and is headquartered in Ludwigshafen am Rhein, Germany.