WestRock (NYSE: WRK) and Svenska Cellulosa SCA (OTCMKTS:SVCBY) are both basic materials companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, dividends, earnings, profitability, analyst recommendations, institutional ownership and valuation.
This is a breakdown of current ratings and recommmendations for WestRock and Svenska Cellulosa SCA, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Svenska Cellulosa SCA||1||0||0||0||1.00|
Risk & Volatility
WestRock has a beta of 1.37, suggesting that its share price is 37% more volatile than the S&P 500. Comparatively, Svenska Cellulosa SCA has a beta of 0.7, suggesting that its share price is 30% less volatile than the S&P 500.
Insider and Institutional Ownership
88.3% of WestRock shares are held by institutional investors. 2.7% of WestRock shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
WestRock pays an annual dividend of $1.72 per share and has a dividend yield of 2.7%. Svenska Cellulosa SCA pays an annual dividend of $0.14 per share and has a dividend yield of 1.3%. WestRock pays out 65.6% of its earnings in the form of a dividend. Svenska Cellulosa SCA pays out 45.2% 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. WestRock has raised its dividend for 2 consecutive years. WestRock is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
This table compares WestRock and Svenska Cellulosa SCA’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Svenska Cellulosa SCA||242.91%||3.73%||1.89%|
Valuation & Earnings
This table compares WestRock and Svenska Cellulosa SCA’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|WestRock||$14.86 billion||1.10||$708.20 million||$2.62||24.49|
|Svenska Cellulosa SCA||$1.95 billion||3.49||$16.62 billion||$0.31||34.48|
Svenska Cellulosa SCA has lower revenue, but higher earnings than WestRock. WestRock is trading at a lower price-to-earnings ratio than Svenska Cellulosa SCA, indicating that it is currently the more affordable of the two stocks.
WestRock beats Svenska Cellulosa SCA on 13 of the 18 factors compared between the two stocks.
WestRock Company Profile
WestRock Company, incorporated on March 6, 2015, is a multinational provider of paper and packaging solutions for consumer and corrugated packaging markets. The Company also develops real estate in the Charleston, South Carolina region. The Company’s segments include Corrugated Packaging, Consumer Packaging, and Land and Development. The Corrugated Packaging segment consists of its containerboard mill and corrugated packaging operations, as well as its recycling operations. The Consumer Packaging segment consists of consumer mills, folding carton, beverage, merchandising displays, and partition operations. The Land and Development segment is engaged in the development and sale of real estate primarily in Charleston, South Carolina.
Svenska Cellulosa SCA Company Profile
Svenska Cellulosa SCA AB is a Sweden-based forest products company that develops solid-wood products, pulp, kraftliner, publication papers and renewable energy. The Company consists of five business units: Forest, Wood, Pulp, Paper, Renewable Energy, and supporting unit Sourcing & Logistics. The Forest unit comprises management of over two million hectares forestland, which is used for timber production. The operations consist of procurement of timber from and the service to private forest owners. The Wood unit consists of sawmills, wood processing units, distribution and wholesale operations. The Pulp unit comprises pulp mill production. The Paper unit manufactures packaging paper and publication papers. The Renewable Energy comprises wind power, forest-based biofuels unit and pellet mills. The Sourcing & Logistics unit provides sea and land transport service within Europe and other overseas destinations.
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