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5 Specialty Chemicals Plays

By  +Follow September 20, 2013 5:44AM
Tickers Mentioned:

The basic materials sector has been a tricky field for investors as of late. Mining companies are in a fluid state due to a number of circumstances, including the turmoil surrounding gold and to a lesser extent other precious metals, while iron ore and copper prices are set to go down due to the recent expectations for a supply glut. And while energy stocks offer a great deal of promise, they too are caught up in a whirlwind of hype resulting from the US and global shale boom.

The specialty chemicals industry, however, offers a number of attractive opportunities.

The following five companies have been selected from that sector based on the kind of healthy fundamentals that are, generally speaking, desirable for basic materias stocks:a price to cash ratio greater than one, indicating that the company not only has cash on hand, but interest to go along with it; a return on equity rate of greater than 20 percent, indicating that the company is investing capital properly and can continue to operate in the long term; a debt/equity ratio of less than 1, indicating that the company's finances are in order; and any kind of dividend yield, since basic materials companies are generally not high-growth, and a dividend of any ammount suggests that the company is doing better than the rest.

Furthermore, all of these stocks have been rated "buy or better" by analysts.

LyondellBasel Industries NV (LYB) –
Market Cap: $42 billion
Price/Cash Ratio: 13.05
Return On Equity: 28.1 percent
Dividend Yield: 2.71 percent
Debt/Equity Ratio: 0.37

The Netherlands-based company is the largest publicly-traded specialty chemicals company on the New York Stock Exchange, and specializes in plastics. The company sells its products in about 100 countries, and counts itself as the world’s largest producer of polypropylene and related compounds that are used in a wide variety of products, including but not limited to thermal undergarments, carpets, loudspeakers, and polymer bank notes. The company has had a good year so far, with shares up over 30 percent to their current price of $73.80.

PPG Industries Inc. (PPG) –
Market Cap: $24 billion
Price/Cash Ratio: 13.53
Return On Equity: 74.70 percent
Dividend Yield: 1.45 percent
Debt/Equity Ratio: 0.67

PPG is based in Pittsburgh, Pennsylvania, and mainly produces coatings and sealants for use in aerospace, automotive, and marine vehicles, as well as architecture and industry. The company also produces materials for use in eye-glasses, as well as fiber glass and packaging, via its facilities which can be found in about 60 countries around the world. PPG is the second largest public specialty chemicals company in the business, and has enjoyed a good 2013, with shares adding more than 25 percent to $168 a piece.

The Sherwin-Williams Company (SHW) –
Market Cap: $18.5 billion
Price/Cash Ratio: 24.91
Return On Equity: 39 percent
Dividend Yield: 1.10 percent
Debt/Equity Ratio: 0.94

The well-known manufacturer of paint and coatings for uses both commercial and industrial, and is the fourth largest public company in the specialty chemicals sector. Most recently, Sherwin-Williams announced the purchase of the US and Canadian segments of the leading Mexican paint company, Consorcio Comex S.A. de C.V. for some $165 million, a deal that had previously been rejected by Mexican regulators. Otherwise, it has been a good year for Sherwin, as the company’s shares have advanced 20 percent to a current price of $181.60 a piece.

International Flavors & Fragrances Inc. (IFF) –
Market Cap: $6.8 billion
Price/Cash Ratio: 18.65
Return On Equity: 21.30 percent
Dividend Yield: 1.86 percent
Debt/Equity Ratio: 0.75

The company develops and manufactures flavoring for food and beverage products, as well as component ingredients for perfume, soap, and other beauty care products. Headquartered in New York City, IFF’s recent second-quarter earnings report showed the company posting substantial year-over-year increases in net sales as well as earnings-per-share. IFF has also had a good year, with shares some 27 percent higher to $83.90 each.

Quaker Chemical Corporation (KWR) –
Market Cap: $905 million
Price/Cash Ratio: 23.52
Return On Equity: 31.10 percent
Dividend Yield: 1.44 percent
Debt/Equity Ratio: 0.08

Quaker produces specialty chemicals primarily for heavy industry and metals manufacturers, including cleaners, lubricants, oils, coatings, and greases. Headquartered in Conshohocken, Pennsylvania, the company has also had a great year, with shares up over 30 percent to their current price of $69.50.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.

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Results for LYB
22 Oct 14 13:58:47
@zettacap lowest rated Basic Industries companies $NUE $LYB $AES for 10/22/14 #bigdata #sp500 #fintech #basicindustries #stocks
22 Oct 14 10:25:05
$LYB up 0.7% to 95.85 bullish setup alert #stocks #options #markets http://t.co/hMLBJhLr8k
Ticker Report
22 Oct 14 09:44:20
LyondellBasell Industries NV $LYB Scheduled to Post Quarterly Earnings on Friday http://t.co/589lJmP3aU
US Banking News
22 Oct 14 09:37:36
LyondellBasell Industries NV $LYB Scheduled to Post Quarterly Earnings on Friday http://t.co/ss9o9mMpnL
22 Oct 14 04:18:24
$LYB:US #LYONDELLBASELL INDUSTRIES NV 22Oct Positive #NewsSentiment http://t.co/tLu8nIo7xB #Russell200
22 Oct 14 04:17:05
$LYB:US #LYONDELLBASELL INDUSTRIES NV 22Oct Positive #NewsSentiment http://t.co/iKbZqDRoKS #SP500
De Ket
22 Oct 14 01:11:28
Published $LYB estimate on Estimize: -0.02 EPS and +20.27M Revs compared to Wall Street's consensus. http://t.co/UY1waGvbsu
anubhav bansal
21 Oct 14 19:16:54
LyondellBasell Industries NV Earns Buy Rating from Citigroup Inc. $LYB http://t.co/WGMvwBrnVd via @RatingsNetwork
21 Oct 14 16:58:35
$LYB - Will Earning help crush overhead resistance? - https://t.co/AvS2toiWAo
TV_Trading Ideas
21 Oct 14 16:58:00
Will Earning help crush overhead resistance? $LYB http://t.co/7i06wk7aU8
21 Oct 14 14:22:11
$LYB - Statement of Changes in Beneficial Ownership (4) http://t.co/MOsdzJLmWx
Alysia Sarkisian
21 Oct 14 12:15:32
RT @SeekingAlpha: Zacks' Bear Of The Day: Axiall http://t.co/aTEcmoL34h $VHI $LYB $KOP $AXLL
Seeking Alpha
21 Oct 14 12:08:11
Zacks' Bear Of The Day: Axiall http://t.co/aTEcmoL34h $VHI $LYB $KOP $AXLL
21 Oct 14 04:16:15
$LYB:US #LYONDELLBASELL INDUSTRIES NV 21Oct Positive #NewsSentiment http://t.co/rYyGcI4G4M #SP500
Joe Attrux
21 Oct 14 03:06:40
RT @SeekingAlpha: Cramer's Lightning Round - If You Have To Own An Auto, Buy Fiat (10/20/14) http://t.co/qKnK8XjI5f $SWKS $FCAU $RRD $NUE $…
Seeking Alpha
21 Oct 14 02:58:40
Cramer's Lightning Round - If You Have To Own An Auto, Buy Fiat (10/20/14) http://t.co/qKnK8XjI5f $SWKS $FCAU $RRD $NUE $LYB $DOW $PLUG
Paul Warnk
20 Oct 14 12:28:35
Market seeking a floor Risk Ratio: 30% Long $GLW <17.97, $LYB <89.99, $INTC <30.78, $HES <79.56, $COP <68.54
20 Oct 14 04:27:04
Popular Tweets Regarding $LYB (Lyondellbasell Inds symbol LYB) on 10/20/2014 http://t.co/QlBXNJaPvA
Erik Grywalski
19 Oct 14 23:28:26
$MGA, $TEN, $LEA, $LYB, $WLK & $TRN are ex of hard breaks during the market's initial decline. If the market rallies & they can't, take note
John Stans
18 Oct 14 08:48:47
RT @KymLang: Earnings Friday $ABBV $BMY $COG $F $LYB $PBR $PG $UPS $WBC
Kym L
17 Oct 14 23:04:17
Earnings Friday $ABBV $BMY $COG $F $LYB $PBR $PG $UPS $WBC
17 Oct 14 15:45:07
$LYB | LyondellBasell In is down 22% since we reported $8,423,525 of insider selling on 09/03/2014. Did you ... - http://t.co/xRjVb4NMpa
Stock Moo
17 Oct 14 03:51:16
$lyb: LyondellBasell to Discuss Third-Quarter Results Friday, October 24 http://t.co/mvyniNA3FH
Stock Moo
17 Oct 14 03:51:14
$lyb: LyondellBasell to Discuss Third-Quarter Results Friday, October 24 http://t.co/ahhCx8Sc2w
17 Oct 14 03:05:09
LyondellBasell NV : to Discuss Third-Quarter Results Friday, October 24 http://t.co/NMP5HGkvy4 $LYB
17 Oct 14 03:02:32
$LYB - LyondellBasell to Discuss Third-Quarter Results Friday, October 24 http://t.co/tpdxzQGJz5
BV Basic Materials
17 Oct 14 03:00:09
$LYB LyondellBasell to Discuss Third-Quarter Results Friday, October 24.. http://t.co/SI6tV789jV
16 Oct 14 23:00:05
Unusual Options Activity: Calls: $TBT $SHPG $SIRI $RSX $SVXY $LLTC $OIH $TXN $SO $COH $SNDK $LYB $INFY $MLNX $CSX http://t.co/Vv2VEn80mr
16 Oct 14 16:02:27
S&P500 #Stocks Performance $CHK $QEP $SNA $DNR $ADS $NFX $RRC $HP $APC $WYNN $TWX $KMI $UNP $THC $BWA $LYB more@ http://t.co/RPeaHBZz9y
16 Oct 14 15:05:01
@SSRIndustrials Commodity Chemicals – Overdone? Maybe Not...& Chemicals Monthly $DOW $LYB $WLK $AXLL $DD $EMN http://t.co/LmvNQuAeuv
Ariel Silahian
16 Oct 14 12:58:03
BNK Invest
16 Oct 14 12:11:17
Thursday Sector Leaders: Energy, Materials $CHK $QEP $XLE $LYB $MLM #stocks http://t.co/zqHboTGbYF
Smarter Analyst
16 Oct 14 12:00:49
$LYB Deutsche Bank Maintains Buy On Lyondellbasell Industries Shares, $125 PT http://t.co/OZuMfUI55i
16 Oct 14 11:21:43
RT @HotKeyTrading: Unusual Options Activity: Calls: $TBT $SHPG $SIRI $RSX $SVXY $LLTC $OIH $TXN $SO $COH $SNDK $LYB $INFY $MLNX $CSX http:/…
16 Oct 14 11:00:05
Unusual Options Activity: Calls: $TBT $SHPG $SIRI $RSX $SVXY $LLTC $OIH $TXN $SO $COH $SNDK $LYB $INFY $MLNX $CSX http://t.co/Vv2VEn80mr
16 Oct 14 10:10:43
$LYB gettin' off
Large Void Bot
16 Oct 14 06:53:11
Daily Reversals: $LYB, $LINE, $CRK, $QRE, $AMJ, $MSG, $MRD, $MWE, $ARP
The Fly
16 Oct 14 04:27:26
$LYB LyondellBasell recent sell-off overdone, says Deutsche Bank: Full Story http://t.co/F3KeWYJu5Z
Stock Signaling
15 Oct 14 20:01:32
Oversold: $VC $COMM $TERP $ICD $WRES $BKCC $HDS $LYB $XEC $LPLA $PNNT $GBX $FSC $ADM $PSX http://t.co/Vtx6dLy0Nw #stock #nasdaq #daytrading
Is This My Money?
14 Oct 14 12:00:39
$LYB looks way oversold on a daily chart, but then zoom out -- it's paid to be a shareholder from mid 2011 at $25.
14 Oct 14 11:15:27
$LYB | LyondellBasell In is down 16% since we reported $1,200,972 of insider selling on 10/01/2014. Did you ... - http://t.co/5CJotNMxZK
By  +Follow September 20, 2013 5:44AM



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