Eastman Chemical Company and Tokuyama Corporation are two notable players in the basic materials sector. A recent analysis compares these companies across several key financial metrics to determine which stock presents a stronger investment opportunity.
Institutional Ownership and Dividends
Eastman Chemical boasts a robust institutional ownership, with approximately 83.7% of its shares held by institutional investors. This indicates a strong belief among large investors that the company will outperform the market in the long term. In contrast, Tokuyama has only 1.9% of its shares owned by insiders, suggesting less confidence from major financial entities.
When it comes to dividends, Eastman Chemical offers an annual dividend of $3.36 per share, resulting in a dividend yield of 5.5%. Tokuyama’s dividend is significantly lower, at $0.12 per share, with a yield of 0.9%. Eastman Chemical has a history of consistent dividend growth, having raised its dividend for 15 consecutive years. This track record makes Eastman Chemical a preferable choice for dividend-seeking investors.
Analyst Ratings and Valuation Metrics
Analysts favor Eastman Chemical, which currently holds a consensus target price of $78.62. This price suggests a potential upside of 27.84%. The stronger consensus rating and higher upside highlight Eastman Chemical’s attractiveness compared to Tokuyama, which does not have a comparable rating.
Evaluating the valuation metrics, Eastman Chemical outperforms Tokuyama in both revenue and earnings per share (EPS). The company enjoys a lower price-to-earnings (P/E) ratio, implying it is more affordable relative to its earnings when compared to Tokuyama. Such metrics are crucial for investors seeking value in their stock selections.
Profitability further distinguishes the companies. Eastman Chemical demonstrates superior net margins and returns on equity and assets, reaffirming its financial strength.
Risk and Volatility Assessment
When assessing risk, Eastman Chemical presents a beta of 1.24, indicating its share price is 24% more volatile than the S&P 500. This suggests higher risk but potentially greater rewards. Conversely, Tokuyama’s beta of 0.15 indicates significantly lower volatility, meaning its share price is 85% less volatile than the S&P 500, appealing to conservative investors.
In summary, Eastman Chemical surpasses Tokuyama in 13 out of 17 factors evaluated, making it a more compelling stock choice for investors.
Company Profiles
Founded in 1920, Eastman Chemical Company is headquartered in Kingsport, Tennessee. The company operates internationally, offering a diverse range of specialty materials across various sectors, including transportation, personal care, and electronics. Its segments encompass additives, advanced materials, chemical intermediates, and fibers.
Tokuyama Corporation, established in 1918 and based in Tokyo, Japan, produces a wide array of chemical products. Its operations span six segments, including chemicals, cement, electronics, and life sciences. The company is known for its comprehensive offerings, from caustic soda to advanced materials for electronics manufacturing.
In conclusion, while both Eastman Chemical and Tokuyama have their strengths, Eastman Chemical’s better performance across multiple metrics positions it as a stronger investment candidate in the basic materials sector.
