The Andersons (NASDAQ: ANDE) and CVR Partners (NYSE:UAN) are both small-cap basic materials companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, institutional ownership, risk, dividends, analyst recommendations and profitability.
Valuation & Earnings
This table compares The Andersons and CVR Partners’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|The Andersons||$3.69 billion||0.27||$42.51 million||$1.46||23.66|
|CVR Partners||$330.80 million||1.16||-$72.78 million||($0.64)||-5.31|
The Andersons has higher revenue and earnings than CVR Partners. CVR Partners is trading at a lower price-to-earnings ratio than The Andersons, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
78.5% of The Andersons shares are owned by institutional investors. Comparatively, 31.0% of CVR Partners shares are owned by institutional investors. 6.3% of The Andersons shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Volatility & Risk
The Andersons has a beta of 1.19, indicating that its share price is 19% more volatile than the S&P 500. Comparatively, CVR Partners has a beta of 1.25, indicating that its share price is 25% more volatile than the S&P 500.
This table compares The Andersons and CVR Partners’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a breakdown of current recommendations for The Andersons and CVR Partners, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
The Andersons presently has a consensus target price of $34.50, indicating a potential downside of 0.14%. CVR Partners has a consensus target price of $5.00, indicating a potential upside of 47.06%. Given CVR Partners’ stronger consensus rating and higher probable upside, analysts plainly believe CVR Partners is more favorable than The Andersons.
The Andersons pays an annual dividend of $0.66 per share and has a dividend yield of 1.9%. CVR Partners pays an annual dividend of $0.02 per share and has a dividend yield of 0.6%. The Andersons pays out 45.2% of its earnings in the form of a dividend. CVR Partners pays out -3.1% 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. CVR Partners has raised its dividend for 3 consecutive years.
The Andersons beats CVR Partners on 9 of the 16 factors compared between the two stocks.
The Andersons Company Profile
The Andersons, Inc., an agriculture company, operates in the grain, ethanol, plant nutrient, and rail sectors in the United States and internationally. The company's Grain segment operates grain elevators; stores grains; and provides grain marketing, risk management, and corn origination services to its customers and affiliated ethanol facilities. Its Ethanol segment purchases and sells ethanol; and offers facility operations, risk management, and ethanol and corn oil marketing services to the ethanol plants it invests in and operates. The company's Rail segment leases, sells, and repairs various types of railcars, locomotives, and barges; provides fleet management services to private railcar owners; and offers metal fabrication services. Its Plant Nutrient segment manufactures, distributes, and retails agricultural and related plant nutrients, corncob-based products, and pelleted lime and gypsum products; and crop nutrients, crop protection chemicals, and seed products, as well as provides application and agronomic services to commercial and family farmers. This segment also offers warehousing, packaging, and manufacturing services to nutrient producers and other distributors; and manufactures and distributes nitrogen reagents for air pollution control systems that are used in coal-fired power plants, and water treatment and dust abatement products. In addition, this segment produces professional turf care products for golf course and turf care markets; and fertilizer and control products, as well as provides contract manufacturing of fertilizer and control products. The Andersons, Inc. was founded in 1947 and is based in Maumee, Ohio.
CVR Partners Company Profile
CVR Partners, LP is a limited partnership formed by CVR Energy, Inc. (CVR Energy) to own, operate and grow its nitrogen fertilizer business. The Company produces and distributes nitrogen fertilizer products, which are used by farmers to manage the yield and quality of their crops. As of December 31, 2016, the Company produced its nitrogen fertilizer products at two manufacturing facilities, located in Coffeyville, Kansas and East Dubuque, Illinois. As of December 31, 2016, the Company’s Coffeyville Facility included a 1,300 ton-per-day capacity ammonia unit, a 3,000 ton-per-day capacity urea-ammonium nitrate (UAN) unit, and a gasifier complex having a capacity of 89 million standard cubic feet per day of hydrogen. The gasifier is a dual-train facility, with each gasifier able to function independently of the other. The Coffeyville Facility utilizes a petroleum coke, or pet coke, gasification process to produce nitrogen fertilizer.
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