Reviewing Asahi Glass (OTCMKTS:ASGLY) and Stepan (NYSE:SCL)

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

Dividends

Asahi Glass pays an annual dividend of $0.16 per share and has a dividend yield of 2.3%. Stepan pays an annual dividend of $1.58 per share and has a dividend yield of 2.5%. Asahi Glass pays out 29.1% of its earnings in the form of a dividend. Stepan pays out -1,316.7% 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. Stepan has raised its dividend for 57 consecutive years. Stepan is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility and Risk

Asahi Glass has a beta of 0.5, indicating that its stock price is 50% less volatile than the S&P 500. Comparatively, Stepan has a beta of 0.94, indicating that its stock price is 6% less volatile than the S&P 500.

Earnings and Valuation

This table compares Asahi Glass and Stepan”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Asahi Glass	$13.77 billion	0.54	$463.39 million	$0.55	12.53
Stepan	$2.33 billion	0.62	$46.90 million	($0.12)	-533.08

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

Profitability

This table compares Asahi Glass and Stepan’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Asahi Glass	4.22%	5.28%	3.05%
Stepan	-0.11%	3.90%	2.01%

Institutional and Insider Ownership

82.7% of Stepan shares are owned by institutional investors. 6.6% of Stepan shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Asahi Glass and Stepan, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Asahi Glass	0	1	0	0	2.00
Stepan	1	0	0	1	2.50

Summary

Stepan beats Asahi Glass on 9 of the 16 factors compared between the two stocks.

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.

About Stepan

Stepan Company, together with its subsidiaries, produces and sells specialty and intermediate chemicals to other manufacturers for use in various end products worldwide. It operates through three segments: Surfactants, Polymers, and Specialty Products. The Surfactants segment offers surfactants that are used in consumer and industrial cleaning and disinfection products, including detergents for washing clothes, dishes, carpets, and floors and walls, as well as shampoos and body washes; and other applications, such as fabric softeners, germicidal quaternary compounds, disinfectants, and lubricating ingredients. Its surfactants are also used in various applications, including emulsifiers for spreading agricultural products; and industrial applications comprising latex systems, plastics, and composites. The Polymers segment provides polyurethane polyols that are used in the manufacture of rigid foam for thermal insulation in the construction industry, as well as a base raw material for coatings, adhesives, sealants, and elastomers (CASE); polyester resins, including liquid and powdered products, which are used in CASE applications; and phthalic anhydride that is used in unsaturated polyester resins, alkyd resins, and plasticizers for applications in construction materials, as well as components of automotive, boating, and other consumer products. The Specialty Products segment offers flavors, emulsifiers, and solubilizers for use in food, flavoring, nutritional supplement, and pharmaceutical applications. Stepan Company was founded in 1932 and is headquartered in Northbrook, Illinois.