Critical Analysis: 5E Advanced Materials (NASDAQ:FEAM) and Elementis (OTCMKTS:ELMTY)

Elementis (OTCMKTS:ELMTY) and 5E Advanced Materials (NASDAQ:FEAM) are both small-cap basic materials companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, risk, institutional ownership, profitability and analyst recommendations.

Earnings and Valuation

This table compares Elementis and 5E Advanced Materials”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Elementis	$738.30 million	1.60	-$47.80 million	N/A	N/A
5E Advanced Materials	N/A	N/A	-$31.56 million	($7.03)	-0.49

5E Advanced Materials has lower revenue, but higher earnings than Elementis.

Analyst Ratings

This is a summary of recent ratings and target prices for Elementis and 5E Advanced Materials, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Elementis	0	0	0	0	0.00
5E Advanced Materials	1	1	2	0	2.25

5E Advanced Materials has a consensus price target of $8.13, indicating a potential upside of 136.88%. Given 5E Advanced Materials’ stronger consensus rating and higher possible upside, analysts clearly believe 5E Advanced Materials is more favorable than Elementis.

Risk and Volatility

Elementis has a beta of 0.15, indicating that its stock price is 85% less volatile than the S&P 500. Comparatively, 5E Advanced Materials has a beta of 1.63, indicating that its stock price is 63% more volatile than the S&P 500.

Profitability

This table compares Elementis and 5E Advanced Materials’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Elementis	N/A	N/A	N/A
5E Advanced Materials	N/A	-103.10%	-64.96%

Summary

5E Advanced Materials beats Elementis on 5 of the 8 factors compared between the two stocks.

About Elementis

Elementis plc operates as a specialty chemical company in the United Kingdom, rest of Europe, North America, and internationally. It operates in two segments, Performance Specialties and Personal Care. The Performance Specialties segment engages in the production of rheological modifiers and additives for decorative and industrial coatings; and production and supply of talc for use in plastics, coatings, technical ceramics, and paper sectors. The Personal Care segment provides rheological modifiers and compounded products, including active ingredients for antiperspirants (AP) deodorants for personal care manufacturers. The company offers personal care products for antiperspirants, color cosmetics, and skin care applications; and performance specialties products for architectural coatings, adhesives, sealants and construction additives, and talc applications. Elementis plc was founded in 1844 and is headquartered in London, the United Kingdom.

About 5E Advanced Materials

5E Advanced Materials, Inc. engages in the exploration and development of mineral properties in Australia and the United States. The company primarily explores for borates and lithium deposits. It holds 100% interest in the Fort Cady project located in the Mojave Desert region in eastern San Bernardino County, California. The company was formerly known as American Pacific Borates Limited. The company was incorporated in 2016 and is based in Hesperia, California.