Analyzing BioAmber (BIOA) and Valvoline (VVV)

BioAmber (NYSE: BIOA) and Valvoline (NYSE:VVV) are both basic materials companies, but which is the better stock? We will compare the two companies based on the strength of their institutional ownership, risk, valuation, profitability, earnings, analyst recommendations and dividends.

Dividends

Valvoline pays an annual dividend of $0.20 per share and has a dividend yield of 0.9%. BioAmber does not pay a dividend. Valvoline pays out 13.4% of its earnings in the form of a dividend.

Insider & Institutional Ownership

36.3% of BioAmber shares are owned by institutional investors. Comparatively, 92.5% of Valvoline shares are owned by institutional investors. 8.3% of BioAmber shares are owned by insiders. Comparatively, 0.1% of Valvoline shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares BioAmber and Valvoline’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
BioAmber $8.27 million 2.71 -$22.47 million ($0.75) -0.57
Valvoline $2.08 billion 2.24 $273.00 million $1.49 15.46

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

Volatility & Risk

BioAmber has a beta of 2.74, indicating that its stock price is 174% more volatile than the S&P 500. Comparatively, Valvoline has a beta of 1.62, indicating that its stock price is 62% more volatile than the S&P 500.

Profitability

This table compares BioAmber and Valvoline’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
BioAmber -238.43% -48.72% -22.92%
Valvoline 14.59% -137.91% 14.86%

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for BioAmber and Valvoline, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
BioAmber 0 1 1 0 2.50
Valvoline 0 4 3 0 2.43

BioAmber presently has a consensus price target of $6.50, suggesting a potential upside of 1,411.63%. Valvoline has a consensus price target of $25.14, suggesting a potential upside of 9.13%. Given BioAmber’s stronger consensus rating and higher probable upside, research analysts plainly believe BioAmber is more favorable than Valvoline.

Summary

Valvoline beats BioAmber on 8 of the 15 factors compared between the two stocks.

BioAmber Company Profile

BioAmber Inc. (BioAmber), formerly DNP Green Technology, Inc., is an industrial biotechnology company, which produces sustainable chemicals. The Company’s technology platform combines industrial biotechnology and chemical catalysis to convert renewable feedstocks into sustainable chemicals that are replacements for petroleum-derived chemicals, which are used in a range of everyday products, including plastics, food additives and personal care products. Its geographical segments include Europe and North America. Its product pipeline includes the derivatives of bio-succinic acid, such as 1,4 Butanediol (1,4 BDO) and tetrahydrofuran (THF), and succinic acid-based polyesters, and C6 building block chemicals, such as adipic acid, caprolactam and hexamethylenediamine (HMDA). Its products are used in various applications, including polyurethanes, resins and coatings, de-icing and coolant solutions, fine chemicals, lubricants, carpets, engineering plastics and artificial leather products.

Valvoline Company Profile

Valvoline Inc. (Valvoline) is engaged in the production and distribution of automotive, commercial and industrial lubricants, and automotive chemicals. The Company operates through three segments: Core North America, Quick Lubes and International. The Core North America segment sells Valvoline, and other branded and private label products in the United States and Canada to both consumers performing their own automotive maintenance, referred to as Do-It-Yourself (DIY) consumers, as well as, to installer customers using Valvoline products to service vehicles owned by Do-It-For-Me (DIFM) consumers. Its Quick Lubes segment services the passenger car and light truck quick lube market through platforms, including its franchised Valvoline Instant Oil Change (VIOC) stores and Express Care. Its International segment sells Valvoline and other branded products through its affiliates, joint ventures, licensees and independent distributors. Its products include All Climate, DuraBlend and MaxLife.

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