Tronox (NYSE:TROX) vs. Hawkins (NASDAQ:HWKN) Head to Head Analysis

Hawkins (NASDAQ:HWKN) and Tronox (NYSE:TROX) are both materials companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, profitability, earnings, analyst recommendations, risk and institutional ownership.

Dividends

Hawkins pays an annual dividend of $0.76 per share and has a dividend yield of 0.6%. Tronox pays an annual dividend of $0.20 per share and has a dividend yield of 3.4%. Hawkins pays out 19.7% of its earnings in the form of a dividend. Tronox pays out -5.8% 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. Hawkins has raised its dividend for 20 consecutive years. Tronox is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Hawkins and Tronox’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hawkins	7.29%	15.42%	8.22%
Tronox	-17.96%	-24.34%	-5.51%

Valuation & Earnings

This table compares Hawkins and Tronox”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hawkins	$1.08 billion	2.52	$81.55 million	$3.86	33.95
Tronox	$2.90 billion	0.33	-$470.00 million	($3.46)	-1.72

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

Insider & Institutional Ownership

69.7% of Hawkins shares are held by institutional investors. Comparatively, 73.4% of Tronox shares are held by institutional investors. 3.7% of Hawkins shares are held by company insiders. Comparatively, 2.0% of Tronox shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Hawkins has a beta of 0.79, suggesting that its share price is 21% less volatile than the S&P 500. Comparatively, Tronox has a beta of 0.82, suggesting that its share price is 18% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Hawkins and Tronox, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hawkins	1	2	1	0	2.00
Tronox	4	4	2	0	1.80

Hawkins currently has a consensus price target of $171.00, suggesting a potential upside of 30.48%. Tronox has a consensus price target of $6.93, suggesting a potential upside of 16.29%. Given Hawkins’ stronger consensus rating and higher probable upside, analysts clearly believe Hawkins is more favorable than Tronox.

Summary

Hawkins beats Tronox on 11 of the 17 factors compared between the two stocks.

About Hawkins

Hawkins, Inc. operates as a specialty chemical and ingredients company in the United States. It operates through three segments: Industrial, Water Treatment, and Health and Nutrition. The Industrial segment offers industrial chemicals, products, and services to agriculture, chemical processing, electronics, energy, food, pharmaceutical, and plating industries. This segment manufactures sodium hypochlorite and agricultural products, as well as various food-grade and pharmaceutical products, such as liquid phosphates, lactates, other blended products, and agricultural products; and receives, stores, and distributes various chemicals comprising liquid caustic soda, sulfuric acid, hydrochloric acid, urea, phosphoric acid, aqua ammonia, and potassium hydroxide. It also repackages water treatment chemicals and bulk industrial chemicals; and performs custom blending of chemicals. The Water Treatment segment provides chemicals, products, equipment, services, and solutions for potable water, municipal and industrial wastewater, industrial process water, non-residential swimming pool water, and agriculture water. The Health and Nutrition segment offers ingredient distribution, processing, and formulation solutions to manufacturers of nutraceutical, functional food and beverage, personal care, dietary supplement and other nutritional food, and health and wellness products. Its products portfolio includes minerals, vitamins and amino acids, excipients, joint products, botanicals and herbs, sweeteners, and enzymes. Hawkins, Inc. was founded in 1938 and is headquartered in Roseville, Minnesota.

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.