LyondellBasell Industries (NYSE:LYB – Get Free Report) and Gulf Resources (NASDAQ:GURE – Get Free Report) are both basic materials companies, but which is the better investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, dividends, profitability, analyst recommendations, earnings and valuation.
Institutional & Insider Ownership
71.2% of LyondellBasell Industries shares are owned by institutional investors. Comparatively, 3.3% of Gulf Resources shares are owned by institutional investors. 0.1% of LyondellBasell Industries shares are owned by insiders. Comparatively, 3.2% of Gulf Resources shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Earnings and Valuation
This table compares LyondellBasell Industries and Gulf Resources”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| LyondellBasell Industries | $30.15 billion | 0.72 | -$738.00 million | ($2.49) | -27.04 |
| Gulf Resources | $7.66 million | 0.94 | -$58.94 million | ($48.05) | -0.10 |
Gulf Resources has lower revenue, but higher earnings than LyondellBasell Industries. LyondellBasell Industries is trading at a lower price-to-earnings ratio than Gulf Resources, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of recent ratings for LyondellBasell Industries and Gulf Resources, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| LyondellBasell Industries | 3 | 8 | 8 | 2 | 2.43 |
| Gulf Resources | 1 | 0 | 0 | 0 | 1.00 |
LyondellBasell Industries currently has a consensus price target of $77.24, indicating a potential upside of 14.70%. Given LyondellBasell Industries’ stronger consensus rating and higher possible upside, research analysts plainly believe LyondellBasell Industries is more favorable than Gulf Resources.
Profitability
This table compares LyondellBasell Industries and Gulf Resources’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| LyondellBasell Industries | -2.68% | 5.68% | 1.77% |
| Gulf Resources | -286.77% | -20.62% | -17.50% |
Volatility & Risk
LyondellBasell Industries has a beta of 0.28, suggesting that its stock price is 72% less volatile than the S&P 500. Comparatively, Gulf Resources has a beta of -0.18, suggesting that its stock price is 118% less volatile than the S&P 500.
Summary
LyondellBasell Industries beats Gulf Resources on 11 of the 15 factors compared between the two stocks.
About LyondellBasell Industries
LyondellBasell Industries N.V. operates as a chemical company in the United States, Germany, Mexico, Italy, Poland, France, Japan, China, the Netherlands, and internationally. The company operates in six segments: Olefins and PolyolefinsAmericas; Olefins and PolyolefinsEurope, Asia, International; Intermediates and Derivatives; Advanced Polymer Solutions; Refining; and Technology. It produces and markets olefins and co-products, polyethylene, and polypropylene; and propylene oxide and derivatives; oxyfuels and related products; and intermediate chemicals, such as styrene monomer, acetyls, ethylene oxide, and ethylene glycol. In addition, the company produce and markets compounding and solutions including polypropylene compounds, engineered plastics, masterbatches, engineered composites, colors and powders, and advanced polymers including catalloy and polybutene-1; and refines heavy, high-sulfur crude oil and other crude oils, as well as refined products, including gasoline and distillates. Further, it develops and licenses chemical and polyolefin process technologies; manufactures and sells polyolefin catalysts; and serves food packaging, home furnishings, automotive components, and paints and coatings applications. LyondellBasell Industries N.V. was incorporated in 2009 and is headquartered in Houston, Texas.
About Gulf Resources
Gulf Resources, Inc., through its subsidiaries, manufactures and trades bromine and crude salt, chemical products, and natural gas in the People’s Republic of China. The company operates through four segments: Bromine, Crude salt, Chemical products, and Natural gas segments. It also provides bromine for use in bromine compounds, intermediates in organic synthesis, brominated flame retardants, fumigants, water purification compounds, dyes, medicines, and disinfectants. In addition, the company offers crude salt for use as a material in alkali and chlorine alkali production for use in the chemical, food and beverage, and other industries. In addition, it manufactures and sells chemical products for use in oil and gas field exploration, oil and gas distribution, oil field drilling, papermaking chemical agents, and inorganic chemicals, as well as materials that are used for human and animal antibiotics. The company is based in Shouguang, the People’s Republic of China.
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