A. Schulman (NASDAQ: SHLM) and PolyOne (NYSE:POL) are both basic materials companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, profitability, risk, earnings, institutional ownership, analyst recommendations and dividends.
Earnings and Valuation
This table compares A. Schulman and PolyOne’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|A. Schulman||$2.46 billion||0.51||$33.02 million||$1.75||24.49|
|PolyOne||$3.23 billion||1.11||-$57.70 million||$2.21||20.12|
This table compares A. Schulman and PolyOne’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent ratings and target prices for A. Schulman and PolyOne, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
A. Schulman presently has a consensus price target of $37.00, indicating a potential downside of 13.65%. PolyOne has a consensus price target of $45.00, indicating a potential upside of 1.19%. Given PolyOne’s stronger consensus rating and higher possible upside, analysts clearly believe PolyOne is more favorable than A. Schulman.
Insider and Institutional Ownership
87.8% of A. Schulman shares are owned by institutional investors. Comparatively, 93.9% of PolyOne shares are owned by institutional investors. 4.1% of A. Schulman shares are owned by company insiders. Comparatively, 1.3% of PolyOne shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Volatility and Risk
A. Schulman has a beta of 1.33, meaning that its stock price is 33% more volatile than the S&P 500. Comparatively, PolyOne has a beta of 1.66, meaning that its stock price is 66% more volatile than the S&P 500.
A. Schulman pays an annual dividend of $0.82 per share and has a dividend yield of 1.9%. PolyOne pays an annual dividend of $0.70 per share and has a dividend yield of 1.6%. A. Schulman pays out 46.9% of its earnings in the form of a dividend. PolyOne pays out 31.7% 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. PolyOne has raised its dividend for 6 consecutive years.
PolyOne beats A. Schulman on 12 of the 17 factors compared between the two stocks.
About A. Schulman
A. Schulman, Inc. manufactures and supplies plastic compounds and resins. It offers custom performance colors, including standard and customized colors, organic and inorganic pigments, high chroma colors in translucent or opaque formats, and special effects. The company also provides engineered composites, such as bulk molding compounds, sheet molding compounds, and thick molding compounds, as well as high performance engineered structural composite solutions for original equipment manufacturers and custom molders. In addition, it offers concentrates to enhance the performance, appearance, and processing of plastics for intended applications; additive solutions; and application solutions that minimize the use of plastics, or incorporate the use of recycled plastics or renewable-based polymers, as well as provides films for agriculture, packaging, and personal care and hygiene applications. Further, the company offers polymer solutions, which provide structural integrity; multi-component blends that include polyolefins, nylons, polyesters and elastomers, and others; and formulating know-how with fiber reinforcements, such as glass and carbon, nano-reinforcements, flame retardants, impact modifiers, and UV stabilization. Additionally, it offers size reduction services; specialty powders for rotational molding, oil and gas additives, and sports and leisure products; jet milling services used for products requiring fine particle size; and cryogenic milling services. The company also buys, repackages, and resells polymers for processing types, such as injection molding, blow molding, thermoforming, and film and sheet extruding. It serves packaging, mobility, building and construction, electronics and electrical, agriculture, personal care and hygiene, custom services, sports, home, and leisure markets in Europe, the Middle East, Africa, the United States, Canada, Latin America, and the Asia Pacific. The company was founded in 1928 and is headquartered in Fairlawn, Ohio.
PolyOne Corporation (PolyOne) provides specialized polymer materials, services and solutions. The Company’s segments include Color, Additives and Inks; Specialty Engineered Materials; Performance Products and Solutions, and PolyOne Distribution. The Color, Additives and Inks segment provides custom color and additive concentrates in solid and liquid form for thermoplastics, dispersions for thermosets. The Specialty Engineered Materials segment provides specialty polymer formulations, services and solutions for designers, assemblers and processors of thermoplastic materials. The Performance Products and Solutions segment consists of the Geon Performance Materials and Producer Services business units. As of December 31, 2016, the PolyOne Distribution segment distributed more than 4,000 grades of engineering and commodity grade resins.
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