Head to Head Survey: Yara International ASA (OTCMKTS:YARIY) and Covestro (OTCMKTS:COVTY)

Posted by Defense World Staff on May 1st, 2023

Yara International ASA (OTCMKTS:YARIY – Get Rating) and Covestro (OTCMKTS:COVTY – Get Rating) are both basic materials companies, but which is the better business? We will compare the two companies based on the strength of their earnings, institutional ownership, risk, dividends, valuation, profitability and analyst recommendations.

Dividends

Yara International ASA pays an annual dividend of $1.50 per share and has a dividend yield of 7.4%. Covestro pays an annual dividend of $1.31 per share and has a dividend yield of 6.0%. Yara International ASA pays out 27.5% of its earnings in the form of a dividend. Covestro pays out -189.9% 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.

Valuation & Earnings

This table compares Yara International ASA and Covestro’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Yara International ASA	$24.05 billion	0.43	$2.78 billion	$5.46	3.69
Covestro	$18.93 billion	0.45	-$286.63 million	($0.69)	-31.78

Yara International ASA has higher revenue and earnings than Covestro. Covestro is trading at a lower price-to-earnings ratio than Yara International ASA, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Yara International ASA and Covestro, as reported by MarketBeat.com.

Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Yara International ASA	1	3	1	0	2.00
Covestro	1	7	6	0	2.36

Covestro has a consensus target price of $42.56, indicating a potential upside of 94.13%. Given Covestro’s stronger consensus rating and higher probable upside, analysts plainly believe Covestro is more favorable than Yara International ASA.

Profitability

This table compares Yara International ASA and Covestro’s net margins, return on equity and return on assets.

Net Margins	Return on Equity	Return on Assets
Yara International ASA	11.55%	34.72%	15.44%
Covestro	-1.34%	0.30%	0.16%

Insider and Institutional Ownership

0.0% of Yara International ASA shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Volatility & Risk

Yara International ASA has a beta of 0.97, meaning that its stock price is 3% less volatile than the S&P 500. Comparatively, Covestro has a beta of 1.24, meaning that its stock price is 24% more volatile than the S&P 500.

Summary

Yara International ASA beats Covestro on 9 of the 15 factors compared between the two stocks.

About Yara International ASA

(Get Rating)

Yara International ASA engages in the production, distribution, and sale of fertilizers. It operates through the following segments: Sales and Marketing, Industrial, Production, and Supply Chain. The Sales and Marketing segment consists of marketing organization and distribution network for fertilizer products and agronomic solutions. The Industrial segment includes developing and selling chemical products and industrial gases to non-fertilizer market segments. The Production segment involves in the manufacturing plants producing ammonia and finished fertilizer, and industrial products. The Supply Chain segment engages in a global function responsible for optimization of energy, raw materials and third party sourcing, as well as logistics and customer service centers. The Company was founded in 1905 and is headquartered in Oslo, Norway.

About Covestro

(Get Rating)

Covestro AG supplies high-tech polymer materials and related application solutions. It operates in two segments, Performance Materials, and Solutions & Specialties. The Performance Materials segment develops, produces, and supplies high-performance materials, such as polyurethanes and polycarbonates, and base chemicals, which include diphenylmethane diisocyanate (MDI), toluylene diisocyanate, long-chain polyols, and polycarbonate resins for use in furniture and wood processing, construction, automotive, and transportation industries, as well as roof structures, insulation for buildings and refrigerators, mattresses, car seats, and other applications. The Solutions & Specialties segment comprises a range of polymer products, including precursors for coatings and adhesives, polycarbonates, MDI specialties and polyols, specialty films, elastomers, and thermoplastic polyurethanes that are used in automotive and transportation, electrical, electronics and household appliances, construction, and healthcare industries, as well as composite resins for wind turbine, rotor blades, laptop cases, and floodlights. The company markets its products through trading houses and distributors. It operates in Europe, the Middle East, Africa, Latin America, the United States, Canada, and the People's Republic of China. The company was founded in 1863 and is headquartered in Leverkusen, Germany.

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