Axalta Coating Systems (NYSE:AXTA – Get Free Report) and Tronox (NYSE:TROX – Get Free Report) are both materials companies, but which is the better business? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, profitability, valuation, analyst recommendations and dividends.
Insider and Institutional Ownership
98.3% of Axalta Coating Systems shares are owned by institutional investors. Comparatively, 73.4% of Tronox shares are owned by institutional investors. 0.5% of Axalta Coating Systems shares are owned by company insiders. Comparatively, 2.0% of Tronox shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Volatility & Risk
Axalta Coating Systems has a beta of 1.26, indicating that its share price is 26% more volatile than the S&P 500. Comparatively, Tronox has a beta of 0.92, indicating that its share price is 8% less volatile than the S&P 500.
Earnings & Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Axalta Coating Systems | $5.12 billion | 1.37 | $378.00 million | $1.62 | 20.16 |
| Tronox | $2.90 billion | 0.20 | -$470.00 million | ($3.46) | -1.05 |
Axalta Coating Systems has higher revenue and earnings than Tronox. Tronox is trading at a lower price-to-earnings ratio than Axalta Coating Systems, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent ratings for Axalta Coating Systems and Tronox, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Axalta Coating Systems | 0 | 8 | 5 | 0 | 2.38 |
| Tronox | 4 | 4 | 1 | 0 | 1.67 |
Axalta Coating Systems currently has a consensus target price of $37.75, indicating a potential upside of 15.57%. Tronox has a consensus target price of $5.83, indicating a potential upside of 60.48%. Given Tronox’s higher probable upside, analysts clearly believe Tronox is more favorable than Axalta Coating Systems.
Profitability
This table compares Axalta Coating Systems and Tronox’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Axalta Coating Systems | 6.78% | 22.35% | 7.12% |
| Tronox | -17.96% | -24.34% | -5.51% |
Summary
Axalta Coating Systems beats Tronox on 12 of the 14 factors compared between the two stocks.
About Axalta Coating Systems
Axalta Coating Systems Ltd., through its subsidiaries, manufactures, markets, and distributes high-performance coatings systems in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. The company operates through two segments, Performance Coatings and Mobility Coatings. It also offers water and solvent-borne products and systems to repair damaged vehicles for independent body shops, multi-shop operators, and original equipment manufacturer (OEM) dealership body shops. In addition, the company provides functional and decorative liquid, and powder coatings used in various industrial applications, including building materials, cabinet, wood and luxury vinyl flooring and furniture market under the Voltatex, AquaEC, Durapon, Hydropon, UNRIVALED, Ceranamel, Industrial, Corlar Industrial, Tufcote, Imron Industrial, Alesta, Teodur, Nap-Gard, Abcite, and Plascoat brands for powder coatings. Further, it develops and supplies electrocoat, primer, the basecoat, and clearcoat products for OEMs of light and commercial vehicles; and coatings systems for various commercial applications, including HDT, MDT, bus, and rail under the Imron, Imron Elite, Centari, Rival, Corlar epoxy undercoats, and AquaEC brands. The company offers products under the Audurra, Abcite, Alesta, AquaEC, Centari, Ceranamel, Challenger, Chemophan, ColorNet, Cromax, Cromax Mosaic, Durapon 70, Duxone, Harmonized Coating Technologies, Imron ExcelPro, Lutophen, Nason, Spies Hecker, Standox, Stollaquid, Syntopal, Syrox, Raptor, U-POL, and Vermeera brand names. The company was formerly known as Axalta Coating Systems Bermuda Co., Ltd. and changed its name to Axalta Coating Systems Ltd. in August 2014. Axalta Coating Systems Ltd. was founded in 1866 and is headquartered in Glen Mills, Pennsylvania.
About Tronox
Tronox Holdings plc operates as a vertically integrated manufacturer of TiO2 pigment in North America, South and Central America, Europe, the Middle East, Africa, and the Asia Pacific. The company operates titanium-bearing mineral sand mines; and engages in beneficiation and smelting operations. It offers TiO2 pigment; ultrafine specialty TiO2; zircon; feedstock; pig iron; monazite; titanium tetrachloride; and other products. The company’s products are used for the manufacture of paints, coatings, plastics, and paper, as well as various other applications. Tronox Holdings plc is based in Stamford, Connecticut.
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