BioAmber (NYSE: BIOA) and Rayonier Advanced Materials (NYSE:RYAM) are both small-cap basic materials companies, but which is the superior investment? We will compare the two businesses based on the strength of their valuation, risk, analyst recommendations, dividends, earnings, profitabiliy and institutional ownership.
Rayonier Advanced Materials pays an annual dividend of $0.28 per share and has a dividend yield of 1.8%. BioAmber does not pay a dividend. Rayonier Advanced Materials pays out 22.8% of its earnings in the form of a dividend.
Volatility & Risk
BioAmber has a beta of 2.61, suggesting that its stock price is 161% more volatile than the S&P 500. Comparatively, Rayonier Advanced Materials has a beta of 4.32, suggesting that its stock price is 332% more volatile than the S&P 500.
Insider and Institutional Ownership
41.2% of BioAmber shares are owned by institutional investors. Comparatively, 87.9% of Rayonier Advanced Materials shares are owned by institutional investors. 8.3% of BioAmber shares are owned by insiders. Comparatively, 2.1% of Rayonier Advanced Materials shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This is a summary of current ratings and target prices for BioAmber and Rayonier Advanced Materials, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Rayonier Advanced Materials||1||2||3||0||2.33|
BioAmber currently has a consensus price target of $4.00, indicating a potential upside of 51.52%. Rayonier Advanced Materials has a consensus price target of $18.40, indicating a potential upside of 17.20%. Given BioAmber’s stronger consensus rating and higher probable upside, analysts plainly believe BioAmber is more favorable than Rayonier Advanced Materials.
Valuation & Earnings
This table compares BioAmber and Rayonier Advanced Materials’ gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|BioAmber||$8.94 million||10.95||-$24.41 million||($0.43)||-6.14|
|Rayonier Advanced Materials||$852.42 million||0.80||$226.31 million||$1.23||12.76|
Rayonier Advanced Materials has higher revenue and earnings than BioAmber. BioAmber is trading at a lower price-to-earnings ratio than Rayonier Advanced Materials, indicating that it is currently the more affordable of the two stocks.
This table compares BioAmber and Rayonier Advanced Materials’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Rayonier Advanced Materials||7.27%||37.41%||4.46%|
Rayonier Advanced Materials beats BioAmber on 10 of the 15 factors compared between the two stocks.
BioAmber Company Profile
BioAmber Inc. (BioAmber), formerly DNP Green Technology, Inc., is an industrial biotechnology company, which produces sustainable chemicals. The Company’s technology platform combines industrial biotechnology and chemical catalysis to convert renewable feedstocks into sustainable chemicals that are replacements for petroleum-derived chemicals, which are used in a range of everyday products, including plastics, food additives and personal care products. Its geographical segments include Europe and North America. Its product pipeline includes the derivatives of bio-succinic acid, such as 1,4 Butanediol (1,4 BDO) and tetrahydrofuran (THF), and succinic acid-based polyesters, and C6 building block chemicals, such as adipic acid, caprolactam and hexamethylenediamine (HMDA). Its products are used in various applications, including polyurethanes, resins and coatings, de-icing and coolant solutions, fine chemicals, lubricants, carpets, engineering plastics and artificial leather products.
Rayonier Advanced Materials Company Profile
Rayonier Advanced Materials Inc. is engaged in the production of cellulose specialties. The Company’s product lines include cellulose specialties and commodity products. Its products are used in manufacturing processes. The Company’s products are sold throughout the world to companies for use in various industrial applications, and to produce a range of products, including cigarette filters, foods, pharmaceuticals, textiles and electronics. The Company focuses on producing various forms of cellulose specialties products, such as cellulose acetate and cellulose ethers. The Company’s production facilities are located in Jesup, Georgia and Fernandina Beach, Florida. The Jesup plant can produce cellulose specialties or commodity products using both hardwood and softwood in a pre-hydrolyzed kraft or high potential of hydrogen (pH) cooking process. The Fernandina Beach plant can produce cellulose specialties or commodity products using softwood in a sulfite or low pH cooking process.
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