Flotek Industries (NYSE:FTK) and Scotts Miracle-Gro (NYSE:SMG) Critical Comparison

Flotek Industries (NYSE:FTK) and Scotts Miracle-Gro (NYSE:SMG) are both materials companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, analyst recommendations, risk and valuation.

Profitability

This table compares Flotek Industries and Scotts Miracle-Gro’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Flotek Industries	8.81%	24.56%	12.01%
Scotts Miracle-Gro	3.16%	-77.42%	8.57%

Volatility & Risk

Flotek Industries has a beta of 1.55, suggesting that its stock price is 55% more volatile than the S&P 500. Comparatively, Scotts Miracle-Gro has a beta of 1.87, suggesting that its stock price is 87% more volatile than the S&P 500.

Valuation and Earnings

This table compares Flotek Industries and Scotts Miracle-Gro”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Flotek Industries	$237.26 million	3.89	$30.53 million	$0.80	31.83
Scotts Miracle-Gro	$3.29 billion	1.15	$103.90 million	$1.68	38.75

Scotts Miracle-Gro has higher revenue and earnings than Flotek Industries. Flotek Industries is trading at a lower price-to-earnings ratio than Scotts Miracle-Gro, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Flotek Industries and Scotts Miracle-Gro, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Flotek Industries	0	0	4	1	3.20
Scotts Miracle-Gro	0	2	5	0	2.71

Flotek Industries presently has a consensus target price of $34.67, indicating a potential upside of 36.13%. Scotts Miracle-Gro has a consensus target price of $74.80, indicating a potential upside of 14.89%. Given Flotek Industries’ stronger consensus rating and higher possible upside, analysts plainly believe Flotek Industries is more favorable than Scotts Miracle-Gro.

Insider & Institutional Ownership

10.9% of Flotek Industries shares are held by institutional investors. Comparatively, 74.1% of Scotts Miracle-Gro shares are held by institutional investors. 2.4% of Flotek Industries shares are held by insiders. Comparatively, 24.4% of Scotts Miracle-Gro shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Scotts Miracle-Gro beats Flotek Industries on 8 of the 15 factors compared between the two stocks.

About Flotek Industries

Flotek Industries is a technology-focused company serving the energy industry with specialty chemistry and data analytics. Its energy chemistry business develops and supplies chemical products used in oil and natural gas drilling, completion, production and other well operations. Through its data analytics business, Flotek provides measurement and analytical services that help energy customers monitor production and make operational decisions. Its offerings combine field data with laboratory analysis and chemistry expertise.

About Scotts Miracle-Gro

Scotts Miracle-Gro Company develops, manufactures and markets branded products for lawn care and gardening. Its offerings include grass seed, lawn fertilizers and weed-control products, soils, plant foods and other products for growing and maintaining lawns, gardens and landscapes. Its consumer brands include Scotts, Miracle-Gro and Ortho. The company also has a Hawthorne business that supplies equipment and products for indoor and hydroponic gardening. Scotts Miracle-Gro’s products are sold primarily in North America, with additional operations and sales in international markets.