Contrasting Perimeter Solutions (NYSE:PRM) & Ashland (NYSE:ASH)

Ashland (NYSE:ASH) and Perimeter Solutions (NYSE:PRM) are both mid-cap materials companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, analyst recommendations, institutional ownership, risk, valuation, dividends and profitability.

Insider and Institutional Ownership

94.0% of Ashland shares are held by institutional investors. Comparatively, 89.9% of Perimeter Solutions shares are held by institutional investors. 1.3% of Ashland shares are held by insiders. Comparatively, 13.1% of Perimeter Solutions shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Ashland and Perimeter Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ashland	0.21%	8.17%	3.36%
Perimeter Solutions	6.68%	19.86%	7.47%

Analyst Ratings

This is a summary of recent recommendations for Ashland and Perimeter Solutions, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ashland	0	4	7	0	2.64
Perimeter Solutions	1	1	4	0	2.50

Ashland currently has a consensus price target of $75.30, indicating a potential downside of 1.59%. Perimeter Solutions has a consensus price target of $41.50, indicating a potential upside of 41.59%. Given Perimeter Solutions’ higher probable upside, analysts plainly believe Perimeter Solutions is more favorable than Ashland.

Volatility & Risk

Ashland has a beta of 0.36, suggesting that its stock price is 64% less volatile than the S&P 500. Comparatively, Perimeter Solutions has a beta of 1.91, suggesting that its stock price is 91% more volatile than the S&P 500.

Earnings and Valuation

This table compares Ashland and Perimeter Solutions”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ashland	$1.86 billion	1.88	$4.00 million	$0.08	956.42
Perimeter Solutions	$652.86 million	7.35	-$206.37 million	$0.13	225.45

Ashland has higher revenue and earnings than Perimeter Solutions. Perimeter Solutions is trading at a lower price-to-earnings ratio than Ashland, indicating that it is currently the more affordable of the two stocks.

Summary

Perimeter Solutions beats Ashland on 8 of the 14 factors compared between the two stocks.

About Ashland

Ashland Inc. is a specialty chemicals company that develops and supplies ingredients and additives for businesses across a range of industries. Its products include pharmaceutical ingredients and excipients, personal care ingredients, and specialty additives used in coatings, construction materials and other applications. The company traces its roots to 1924, when it was established as Ashland Refining Company in Kentucky. Over time, Ashland shifted from its origins in oil refining toward specialty chemicals and ingredients.

About Perimeter Solutions

Perimeter Solutions is a global provider of fire safety products and specialty chemicals. Its fire safety business develops products used to prevent and suppress wildfires and to fight structural and industrial fires, including long-term fire retardants, firefighting foams and related agents. Its PHOS-CHEK brand is used in wildfire management. The company also makes lubricant additives, including phosphorus-based products used in industrial and transportation applications. Its products serve customers in multiple regions around the world, including firefighting agencies and operators that rely on specialty chemical solutions.