Contrasting NL Industries (NYSE:NL) & SIKA (OTCMKTS:SXYAY)

NL Industries (NYSE:NL) and SIKA (OTCMKTS:SXYAY) are both basic materials companies, but which is the better business? We will contrast the two companies based on the strength of their risk, profitability, earnings, dividends, analyst recommendations, valuation and institutional ownership.

Analyst Recommendations

This is a summary of recent recommendations for NL Industries and SIKA, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NL Industries	0	1	0	0	2.00
SIKA	1	3	2	3	2.78

Dividends

NL Industries pays an annual dividend of $0.36 per share and has a dividend yield of 5.8%. SIKA pays an annual dividend of $0.09 per share and has a dividend yield of 0.4%. NL Industries pays out 180.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NL Industries has increased its dividend for 2 consecutive years. NL Industries is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation and Earnings

This table compares NL Industries and SIKA”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NL Industries	$145.90 million	2.08	$67.23 million	$0.20	31.13
SIKA	$13.52 billion	2.44	$1.26 billion	N/A	N/A

SIKA has higher revenue and earnings than NL Industries.

Institutional & Insider Ownership

10.7% of NL Industries shares are owned by institutional investors. 0.3% of NL Industries shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares NL Industries and SIKA’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NL Industries	6.10%	2.36%	1.83%
SIKA	N/A	N/A	N/A

About NL Industries

NL Industries, Inc., through its subsidiary, CompX International Inc., operates in the component products industry in Europe, North America, the Asia Pacific, and internationally. The company manufactures and sells mechanical and electronic cabinet locks and other locking mechanisms, including disc tumbler locks; pin tumbler locking mechanisms under KeSet, System 64, TuBar, and Turbine brands; and electronic locks under CompX eLock and StealthLock brands for use in various applications, such as mailboxes, ignition systems, file cabinets, desk drawers, tool storage cabinets, high security medical cabinetry, integrated inventory and access control secured narcotics boxes, electronic circuit panels, storage compartments, gas station security, vending and cash containment machines. It also offers original equipment and aftermarket stainless steel exhaust headers, exhaust pipes, mufflers, and other exhaust components; gauges, such as GPS speedometers and tachometers; mechanical and electronic controls and throttles; wake enhancement devices, trim tabs, steering wheels, and other billet aluminum accessories; dash panels, LED indicators, wire harnesses, and other accessories; and grab handles, pin cleats, and other accessories; primarily for performance and ski/wakeboard and performance boats. In addition, the company produces and markets value-added titanium dioxide pigments, a base industrial product used in imparting whiteness, brightness, opacity, and durability to a diverse range of customer applications and end-use markets, including coatings, plastics, paper, inks, cosmetics, pharmaceuticals, and other industrial and consumer products. The company sells its component products directly to original equipment manufacturers, as well as through distributors. NL Industries, Inc. was founded in 1891 and is based in Dallas, Texas. NL Industries, Inc. operates as a subsidiary of Valhi, Inc.

About SIKA

Sika AG, a specialty chemicals company, develops, produces, and sells systems and products for bonding, sealing, damping, reinforcing, and protecting in the building sector and motor vehicle industry worldwide. The company offers tile adhesives and grouts, systems for under-tile waterproofing, sound reduction, renders, decorative finishes for exterior and interior walls, as well as exterior insulation finishing system; develops admixtures and additives for concrete, cement, and mortar production; and flat roofing systems. It also provides a range of technologies used for below and above-ground waterproofing, including flexible membrane systems, liquid-applied membranes, joint waterproofing systems, and waterproofing mortars and injection resins for commercial and residential basements, tunnels, bridges, and various types of water-retaining structures, such as reservoirs, storage basins, and storage tanks. In addition, the company offers flooring solutions, such as synthetic resin and cementitious systems for industrial and commercial buildings; and sealants, adhesives, tapes, and spray foams for the building facades, interior finishing, and infrastructure projects. Further, it provides repairing, reinforcing, and protective solutions for concrete structures, such as repair mortars, shrinking grouts, anchoring adhesives, protective coatings, corrosion control, and structural strengthening systems. The company serves automobile and commercial vehicle assembly, automotive aftermarket, marine vessel, industrial lamination, renewable energy, home appliance, and facade engineering industries. The company was founded in 1910 and is headquartered in Baar, Switzerland.