Valvoline (NYSE: VVV) and Showa Denko K.K. (OTCMKTS:SHWDY) are both basic materials companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, earnings, dividends, risk, analyst recommendations and institutional ownership.
Insider & Institutional Ownership
95.5% of Valvoline shares are owned by institutional investors. 0.6% of Valvoline shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
This is a breakdown of recent recommendations and price targets for Valvoline and Showa Denko K.K., as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Showa Denko K.K.||0||0||0||0||N/A|
Valvoline presently has a consensus target price of $25.67, suggesting a potential upside of 16.83%. Given Valvoline’s higher possible upside, equities analysts clearly believe Valvoline is more favorable than Showa Denko K.K..
Valvoline pays an annual dividend of $0.30 per share and has a dividend yield of 1.4%. Showa Denko K.K. does not pay a dividend. Valvoline pays out 27.5% of its earnings in the form of a dividend.
This table compares Valvoline and Showa Denko K.K.’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Showa Denko K.K.||N/A||N/A||N/A|
Earnings and Valuation
This table compares Valvoline and Showa Denko K.K.’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Valvoline||$2.08 billion||2.11||$304.00 million||$1.09||20.16|
|Showa Denko K.K.||$5.76 billion||11.09||$1.60 billion||$1.07||39.87|
Showa Denko K.K. has higher revenue and earnings than Valvoline. Valvoline is trading at a lower price-to-earnings ratio than Showa Denko K.K., indicating that it is currently the more affordable of the two stocks.
Valvoline beats Showa Denko K.K. on 8 of the 14 factors compared between the two stocks.
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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