Reviewing KURARAY CO LTD/ADR (OTCMKTS:KURRY) and SHOWA DENKO KK/ADR (OTCMKTS:SHWDY)

KURARAY CO LTD/ADR (OTCMKTS:KURRY) and SHOWA DENKO KK/ADR (OTCMKTS:SHWDY) are both basic materials companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, institutional ownership, risk, valuation, dividends, earnings and analyst recommendations.

Valuation & Earnings

This table compares KURARAY CO LTD/ADR and SHOWA DENKO KK/ADR’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
KURARAY CO LTD/ADR $5.46 billion 0.77 $305.40 million $3.48 10.44
SHOWA DENKO KK/ADR $8.99 billion 4.05 $1.00 billion $8.92 2.73

SHOWA DENKO KK/ADR has higher revenue and earnings than KURARAY CO LTD/ADR. SHOWA DENKO KK/ADR is trading at a lower price-to-earnings ratio than KURARAY CO LTD/ADR, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares KURARAY CO LTD/ADR and SHOWA DENKO KK/ADR’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
KURARAY CO LTD/ADR 3.92% 6.47% 3.76%
SHOWA DENKO KK/ADR N/A N/A N/A

Dividends

KURARAY CO LTD/ADR pays an annual dividend of $0.85 per share and has a dividend yield of 2.3%. SHOWA DENKO KK/ADR pays an annual dividend of $0.68 per share and has a dividend yield of 2.8%. KURARAY CO LTD/ADR pays out 24.4% of its earnings in the form of a dividend. SHOWA DENKO KK/ADR pays out 7.6% 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. SHOWA DENKO KK/ADR is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

0.0% of KURARAY CO LTD/ADR shares are owned by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Risk & Volatility

KURARAY CO LTD/ADR has a beta of 0.73, indicating that its share price is 27% less volatile than the S&P 500. Comparatively, SHOWA DENKO KK/ADR has a beta of 1.7, indicating that its share price is 70% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations and price targets for KURARAY CO LTD/ADR and SHOWA DENKO KK/ADR, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
KURARAY CO LTD/ADR 0 0 0 0 N/A
SHOWA DENKO KK/ADR 0 1 0 0 2.00

Summary

SHOWA DENKO KK/ADR beats KURARAY CO LTD/ADR on 7 of the 12 factors compared between the two stocks.

KURARAY CO LTD/ADR Company Profile

Kuraray Co., Ltd. manufactures and sells chemicals and resins, fibers and textiles, high performance materials, medical products, and others products worldwide. The company's Vinyl Acetate segment offers functional resins and films, including polyvinyl alcohol (PVA) resins for paper/fiber processing agents, adhesives, and others; optical-use PVA films for liquid crystal display televisions, mobile phone screens, and others; water-soluble PVA films for water soluble delivery system and others; PVB films for use as interlayers for laminated safety glass and photovoltaic module encapsulation; EVAL resins and films for food packaging, automobile tanks/vacuum insulation panels, refrigerators, and others; and PLANTIC, a bio-based barrier material for fresh food packaging and industrial uses. Its Isoprene segment produces isoprene chemicals; thermoplastic elastomers; heat-resistant polyamide resins; liquid rubber as additive agent for automobile tires and others; and acrylic thermoplastic elastomers. The company's Functional Materials segment offers man made leather products; methacrylic resins for LCDs, automobile light covers, signboards, construction materials, and others; and dental materials for treating cavities. Its Fibers and Textile segment provides PVA fibers, which are reinforcing materials for cement, concrete, and others; non-woven fabrics for everyday goods, industrial products, and others; hook and loop fasteners for clothing, sporting goods, industrial materials, and others; and polyarylate fibers for rope, fishing net, and other industrial products. The company's Trading segment engages in the import, export, and wholesale of fibers and textiles, including polyester filaments and chemicals. Its Others segment offers membranes, activated carbons, and others. The company also engages in water purification, wastewater treatment, ballast water management system, and other businesses. Kuraray Co., Ltd. was founded in 1926 and is headquartered in Tokyo, Japan.

SHOWA DENKO KK/ADR Company Profile

Showa Denko K.K. operates as a chemical company in Japan and internationally. It operates in six segments: Petrochemicals, Chemicals, Electronics, Inorganics, Aluminum, and Others. The Petrochemicals segment offers olefins, including ethylene, propylene, C4 fraction, cracked fuel oils, etc.; and organic chemicals, including vinyl acetate monomer, vinyl and ethyl acetate, allyl alcohol, acetaldehyde, acetic acid, and allyl ester resins, as well as polypropylene. The Chemicals segment provides functional chemicals, such as polymer emulsion and unsaturated polyester resins; industrial gases comprising liquefied carbon dioxide, dry ice, oxygen, nitrogen, hydrogen, argon, fusing ethylene, and helium; basic chemicals that include liquefied ammonia, acrylonitrile, and chloroprene rubber; and electronic chemicals, which comprise high-purity gases for electronics. The Electronics segment offers aluminum based and glass based hard disks (HDs); aluminum substrates for HDs; LED chips, epitaxial wafers, rare earth magnetic alloys, and lithium-ion battery materials; MOCVD epitaxial wafers; and advanced battery materials. The Inorganics segment provides alumina electrical fillers fused materials, abrasive grains lapping and polishing materials, plasma spraying materials, refractories, alumina for heat-radiation fillers, spherical alumina, hexagonal boron nitride, lubrication and mold-release agents, and polishing materials; and graphite electrodes. The Aluminum segment offers aluminum capacitor foils and aluminum sheets; extruded and forged products, aluminum cylinders, cast rods of aluminum alloys, compressors, heat exchangers, and power semiconductor cooling devices; and aluminum beverage cans. The Others segment engages in the general trading and building materials business; and sells chemicals, resins, metals, and electronic materials. The company was founded in 1908 and is headquartered in Tokyo, Japan.

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