Financial Analysis: Oil-Dri Corporation Of America (NYSE:ODC) versus Northern Technologies International (NASDAQ:NTIC)

Dividends

Oil-Dri Corporation Of America pays an annual dividend of $0.72 per share and has a dividend yield of 1.2%. Northern Technologies International pays an annual dividend of $0.04 per share and has a dividend yield of 0.5%. Oil-Dri Corporation Of America pays out 21.2% of its earnings in the form of a dividend. Northern Technologies International pays out 13.3% 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. Oil-Dri Corporation Of America has raised its dividend for 11 consecutive years. Oil-Dri Corporation Of America is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Oil-Dri Corporation Of America and Northern Technologies International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Oil-Dri Corporation Of America	10.44%	21.57%	13.85%
Northern Technologies International	3.46%	3.38%	2.66%

Earnings and Valuation

This table compares Oil-Dri Corporation Of America and Northern Technologies International”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Oil-Dri Corporation Of America	$474.06 million	1.81	$39.43 million	$3.40	17.26
Northern Technologies International	$85.06 million	0.81	$5.41 million	$0.30	24.37

Oil-Dri Corporation Of America has higher revenue and earnings than Northern Technologies International. Oil-Dri Corporation Of America is trading at a lower price-to-earnings ratio than Northern Technologies International, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

49.0% of Oil-Dri Corporation Of America shares are owned by institutional investors. Comparatively, 32.9% of Northern Technologies International shares are owned by institutional investors. 11.7% of Oil-Dri Corporation Of America shares are owned by company insiders. Comparatively, 24.3% of Northern Technologies International shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility & Risk

Oil-Dri Corporation Of America has a beta of 0.67, suggesting that its share price is 33% less volatile than the S&P 500. Comparatively, Northern Technologies International has a beta of 0.27, suggesting that its share price is 73% less volatile than the S&P 500.

Summary

Oil-Dri Corporation Of America beats Northern Technologies International on 11 of the 14 factors compared between the two stocks.

About Oil-Dri Corporation Of America

Oil-Dri Corporation of America is a manufacturer and supplier of specialty sorbent products for the pet care, animal health and nutrition, fluids purification, agricultural ingredients, sports field, industrial and automotive markets. It operates through the Business to Business Products Group and Retail and Wholesale Products Group segments. The Business to Business Products Group segment’s customers include processors and refiners of edible oils, jet fuel and biofuel, manufacturers of animal feed and agricultural chemicals, distributors of animal health and nutrition products, and marketers of consumer products. The Retail and Wholesale Products Group segment customers include retailers of cat litter and related accessories such as mass merchandisers, drugstore chains, pet specialty retail outlets, dollar stores, retail grocery stores as well as distributors of industrial cleanup and automotive products, environmental service companies, and sports field product users. The company was founded by Nick Jaffee in 1941 and is headquartered in Chicago, IL.

About Northern Technologies International

Northern Technologies International Corporation develops and markets rust and corrosion inhibiting solutions in North America, South America, Europe, Asia, the Middle East and internationally. It offers rust and corrosion inhibiting products, such as plastic and paper packaging, liquids, coatings, rust removers, cleaners, diffusers, and engineered solutions designed for the oil and gas industry under the ZERUST brand. The company provides a portfolio of bio-based and certified compostable polymer resin compounds and finished products under the Natur-Tec brand. In addition, it offers on-site and technical consulting for rust and corrosion prevention issues. It sells its products and services to automotive, electronics, electrical, mechanical, military, retail consumer, and oil and gas markets through direct sales force, network of independent distributors, agents, manufacturer's sales representatives, and strategic partners. The company was founded in 1970 and is headquartered in Circle Pines, Minnesota.