Contrasting Celanese (NYSE:CE) & AdvanSix (NYSE:ASIX)

Celanese (NYSE:CE) and AdvanSix (NYSE:ASIX) are both basic materials companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, dividends, analyst recommendations, earnings and profitability.

Valuation & Earnings

This table compares Celanese and AdvanSix”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Celanese	$10.28 billion	0.59	-$1.52 billion	($28.27)	-1.97
AdvanSix	$1.52 billion	0.32	$44.15 million	$1.92	9.41

AdvanSix has lower revenue, but higher earnings than Celanese. Celanese is trading at a lower price-to-earnings ratio than AdvanSix, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

98.9% of Celanese shares are owned by institutional investors. Comparatively, 86.4% of AdvanSix shares are owned by institutional investors. 0.3% of Celanese shares are owned by insiders. Comparatively, 5.6% of AdvanSix shares are owned by 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 and Risk

Celanese has a beta of 1.12, suggesting that its stock price is 12% more volatile than the S&P 500. Comparatively, AdvanSix has a beta of 1.72, suggesting that its stock price is 72% more volatile than the S&P 500.

Dividends

Celanese pays an annual dividend of $0.12 per share and has a dividend yield of 0.2%. AdvanSix pays an annual dividend of $0.64 per share and has a dividend yield of 3.5%. Celanese pays out -0.4% of its earnings in the form of a dividend. AdvanSix pays out 33.3% 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. AdvanSix has increased its dividend for 2 consecutive years. AdvanSix is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Celanese and AdvanSix, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Celanese	3	11	7	0	2.19
AdvanSix	1	1	1	0	2.00

Celanese currently has a consensus price target of $55.44, suggesting a potential downside of 0.33%. AdvanSix has a consensus price target of $28.67, suggesting a potential upside of 58.64%. Given AdvanSix’s higher possible upside, analysts plainly believe AdvanSix is more favorable than Celanese.

Profitability

This table compares Celanese and AdvanSix’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Celanese	-31.85%	9.87%	2.29%
AdvanSix	3.52%	7.14%	3.50%

Summary

AdvanSix beats Celanese on 10 of the 17 factors compared between the two stocks.

About Celanese

Celanese Corporation, a chemical and specialty materials company, manufactures and sells high performance engineered polymers in the United States and internationally. It operates through Engineered Materials and Acetyl Chain. The Engineered Materials segment develops, produces, and supplies specialty polymers for automotive and medical applications, as well as for use in industrial products and consumer electronics. The Acetyl Chain segment produces and supplies acetyl products, including acetic acid, vinyl acetate monomers, acetic anhydride, and acetate esters that are used as starting materials for colorants, paints, adhesives, coatings, and pharmaceuticals; and organic solvents and intermediates for pharmaceutical, agricultural, and chemical products. It also offers vinyl acetate-based emulsions for use in paints and coatings, adhesives, construction, glass fiber, textiles, and paper applications; and ethylene vinyl acetate resins and compounds, as well as low-density polyethylene for use in flexible packaging films, lamination film products, hot melt adhesives, automotive parts, and carpeting applications. In addition, it provides redispersible powders (RDP) for use in construction applications, including flooring, plasters, insulation, tiling, and waterproofing. Celanese Corporation was founded in 1918 and is headquartered in Irving, Texas.

About AdvanSix

AdvanSix Inc. engages in the manufacture and sale of polymer resins in the United States and internationally. It offers Nylon 6, a polymer resin, which is a synthetic material used to produce fibers, filaments, engineered plastics, and films. The company also provides caprolactam to manufacture polymer resins; ammonium sulfate fertilizers to distributors, farm cooperatives, and retailers; and acetone that are used in the production of adhesives, paints, coatings, solvents, herbicides, and engineered plastic resins, as well as other intermediate chemicals, including phenol, monoisopropylamine, dipropylamine, monoallylamine, alpha-methylstyrene, cyclohexanone, methyl ethyl ketoxime, acetaldehyde oxime, 2-pentanone oxime, cyclohexanol, sulfuric acid, ammonia, and carbon dioxide. It offers its products under the Aegis, Capran, Sulf-N, Nadone, Naxol, and EZ-Blox brands. The company sells its products directly, as well as through distributors. AdvanSix Inc. was incorporated in 2016 and is headquartered in Parsippany, New Jersey.