Analyzing Perimeter Solutions (NYSE:PRM) and Sherwin-Williams (NYSE:SHW)

Sherwin-Williams (NYSE:SHW) and Perimeter Solutions (NYSE:PRM) are both basic materials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, earnings, profitability, risk and institutional ownership.

Volatility & Risk

Sherwin-Williams has a beta of 1.16, suggesting that its share price is 16% more volatile than the S&P 500. Comparatively, Perimeter Solutions has a beta of 1.96, suggesting that its share price is 96% more volatile than the S&P 500.

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sherwin-Williams	$23.10 billion	3.97	$2.68 billion	$10.08	36.47
Perimeter Solutions	$560.97 million	4.85	-$5.91 million	$0.43	43.18

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

Insider and Institutional Ownership

77.7% of Sherwin-Williams shares are held by institutional investors. Comparatively, 89.9% of Perimeter Solutions shares are held by institutional investors. 0.6% of Sherwin-Williams shares are held by insiders. Comparatively, 10.0% of Perimeter Solutions shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Sherwin-Williams and Perimeter Solutions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sherwin-Williams	11.03%	66.91%	11.48%
Perimeter Solutions	13.05%	-1.11%	-0.52%

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Sherwin-Williams and Perimeter Solutions, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sherwin-Williams	0	6	10	1	2.71
Perimeter Solutions	0	0	2	0	3.00

Sherwin-Williams currently has a consensus target price of $388.60, indicating a potential upside of 5.71%. Perimeter Solutions has a consensus target price of $18.50, indicating a potential downside of 0.36%. Given Sherwin-Williams’ higher probable upside, equities analysts plainly believe Sherwin-Williams is more favorable than Perimeter Solutions.

Summary

Sherwin-Williams beats Perimeter Solutions on 8 of the 15 factors compared between the two stocks.

About Sherwin-Williams

The Sherwin-Williams Company engages in the development, manufacture, distribution, and sale of paints, coating, and related products to professional, industrial, commercial, and retail customers. It operates through three segments: Paint Stores Group, Consumer Brands Group, and Performance Coatings Group. The Paint Stores Group segment offers architectural paints and coatings, and protective and marine products, as well as OEM product finishes and related products for architectural and industrial paint contractors, and do-it-yourself homeowners. The Consumer Brands Group segment supplies a portfolio of branded and private-label architectural paints, stains, varnishes, industrial products, wood finishes products, wood preservatives, applicators, corrosion inhibitors, aerosols, caulks, and adhesives to retailers, including home centers and hardware stores, and dedicated dealers and distributors. The Performance Coatings Group segment develops and sells industrial coatings for wood finishing and general industrial applications, automotive refinish products, protective and marine coatings, coil coatings, packaging coatings, and performance-based resins and colorants. It serves retailers, dealers, jobbers, licensees, and other third-party distributors through its branches and direct sales staff, as well as through outside sales representatives. The company has operations primarily in the North and South America, the Caribbean, Europe, Asia, and Australia. The Sherwin-Williams Company was founded in 1866 and is headquartered in Cleveland, Ohio.

About Perimeter Solutions

Perimeter Solutions, SA manufactures and supplies firefighting products and lubricant additives in the United States, Germany, and internationally. It operates in two segments, Fire Safety and Specialty Products. The Fire Safety segment provides fire retardants and firefighting foams, as well as specialized equipment and services for federal, state, provincial, local/municipal, and commercial customers. The Specialty Products segment produces and sells Phosphorus Pentasulfide, which is primarily used in the preparation of lubricant additives, including a family of compounds called Zinc Dialkyldithiophosphates. The company offers its products under the PHOS-CHEK, FIRE-TROL, AUXQUIMIA, and SOLBERG brands. Perimeter Solutions, SA was founded in 1963 and is headquartered in Clayton, Missouri.