PPG Industries (NYSE:PPG) & Asahi Glass (OTCMKTS:ASGLY) Critical Survey

PPG Industries (NYSE:PPG) and Asahi Glass (OTCMKTS:ASGLY) are both materials companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, institutional ownership, valuation, profitability, risk, analyst recommendations and dividends.

Profitability

This table compares PPG Industries and Asahi Glass’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PPG Industries	9.57%	21.07%	7.80%
Asahi Glass	4.22%	5.28%	3.05%

Insider & Institutional Ownership

81.9% of PPG Industries shares are held by institutional investors. 0.3% of PPG Industries shares are held by company 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.

Earnings and Valuation

This table compares PPG Industries and Asahi Glass”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PPG Industries	$16.42 billion	1.46	$1.58 billion	$6.98	15.40
Asahi Glass	$13.77 billion	0.58	$463.39 million	$0.55	13.25

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

Analyst Ratings

This is a breakdown of recent recommendations for PPG Industries and Asahi Glass, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PPG Industries	0	9	8	0	2.47
Asahi Glass	0	1	0	0	2.00

PPG Industries currently has a consensus price target of $126.81, indicating a potential upside of 17.94%. Given PPG Industries’ stronger consensus rating and higher possible upside, equities research analysts clearly believe PPG Industries is more favorable than Asahi Glass.

Dividends

PPG Industries pays an annual dividend of $2.96 per share and has a dividend yield of 2.8%. Asahi Glass pays an annual dividend of $0.16 per share and has a dividend yield of 2.2%. PPG Industries pays out 42.4% of its earnings in the form of a dividend. Asahi Glass pays out 29.1% 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. PPG Industries has raised its dividend for 54 consecutive years. PPG Industries is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

PPG Industries has a beta of 1.07, suggesting that its share price is 7% more volatile than the S&P 500. Comparatively, Asahi Glass has a beta of 0.46, suggesting that its share price is 54% less volatile than the S&P 500.

Summary

PPG Industries beats Asahi Glass on 16 of the 17 factors compared between the two stocks.

About PPG Industries

PPG Industries, Inc. manufactures and distributes paints, coatings, and specialty materials in the United States, Canada, the Asia Pacific, Latin America, Europe, the Middle East, and Africa. It operates through two segments, Performance Coatings and Industrial Coatings. The Performance Coatings segment offers coatings, solvents, adhesives, sealants, sundries, and software for automotive and commercial transport/fleet repair and refurbishing, light industrial coatings, and specialty coatings for signs; wood stains; paints, thermoplastics, pavement marking products, and other advanced technologies for pavement marking for government, commercial infrastructure, painting, and maintenance contractors; and coatings, sealants, transparencies, transparent armor, adhesives, engineered materials, and packaging and chemical management services for commercial, military, regional jet, and general aviation aircraft. The Industrial Coatings segment offers coatings, adhesives and sealants, and metal pretreatments, as well as services and coatings applications for appliances, agricultural and construction equipment, consumer electronics, automotive parts and accessories, building products, kitchenware, and transportation vehicles and other finished products; and on-site coatings services. It also provides coatings for metal cans, closures, plastic and aluminum tubes for food, beverage and personal care, promotional, and specialty packaging; amorphous precipitated silica for tire, battery separator, and other end-uses; TESLIN substrates for labels, e-passports, drivers' licenses, breathable membranes, and loyalty and identification cards; and organic light emitting diode materials, displays and lighting lens materials, optical lenses, color-change products, and photochromic dyes. PPG Industries, Inc. was incorporated in 1883 and is headquartered in Pittsburgh, Pennsylvania.

About Asahi Glass

AGC Inc. manufactures and sells glass, automotive, electronics, chemicals, and ceramics worldwide. The company offers architectural glass products, including laminated, insulating, wired, solar control, toughened, decorative, sound insulation, float and patterned, and industrial glasses; structural glazing systems; and automotive glass, such as laminated, tempered, and privacy glasses, as well as integrated glass antennas and module assembly windows. It also provides glass substrates for thin-film-transistor liquid crystal displays and OLEDs; synthetic fused silica glass, synthetic quartz crystals, silicon carbides, CMP slurry, through glass Vias, high refractive index glass, diffusers, glass ceramics substrates, optical planar devices, IR cut filters, aspherical glass and molded lens, and micro lens array products; polycarbonate and optical sheets, thin sheets, and films; and glass frits and pastes, as well as glass substrates for semiconductor packaging and other electronic materials. In addition, the company offers cover glass for smartphones and tablet devices; glass substrates for photovoltaic devices and touch panels; specialty glass; extra clear float glass; transparent conductive oxide glass for a-Si type solar module; and ultra-thin glass for electronics devices. Further, it provides chlor-alkali, polyurethanes, fluoro, and specialty chemical products; high thermal insulation ceramics wall for furnaces; and ceramic beads, sputtering targets, abrasion resistant ceramics, alumina cement, engineering fine ceramics, and ceramics molding agents for 3D printers. Additionally, the company engages in the digital signage on glass, copper clad laminate, and plastic optical fiber businesses; and gas and solvents, and life Science businesses. The company was formerly known as Asahi Glass Co., Ltd. and changed its name to AGC Inc. in July 2018. AGC Inc. was founded in 1907 and is headquartered in Tokyo, Japan.