Comparing Westaim (OTCMKTS:WEDXF) & PPG Industries (NYSE:PPG)

PPG Industries (NYSE:PPG) and Westaim (OTCMKTS:WEDXF) are both basic materials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, dividends, valuation, profitability and institutional ownership.

Insider & Institutional Ownership

81.9% of PPG Industries shares are owned by institutional investors. 0.3% of PPG Industries shares are owned by company insiders. Comparatively, 4.2% of Westaim shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

PPG Industries pays an annual dividend of $2.84 per share and has a dividend yield of 2.8%. Westaim pays an annual dividend of $0.09 per share and has a dividend yield of 0.6%. PPG Industries pays out 64.4% of its earnings in the form of a dividend. Westaim pays out -5.3% 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. PPG Industries has increased its dividend for 54 consecutive years. PPG Industries is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Volatility & Risk

PPG Industries has a beta of 1.19, meaning that its stock price is 19% more volatile than the S&P 500. Comparatively, Westaim has a beta of 0.2, meaning that its stock price is 80% less volatile than the S&P 500.

Profitability

This table compares PPG Industries and Westaim’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PPG Industries	6.35%	24.17%	9.91%
Westaim	-118.02%	-5.51%	-4.97%

Earnings and Valuation

This table compares PPG Industries and Westaim”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PPG Industries	$15.69 billion	1.43	$1.12 billion	$4.41	22.68
Westaim	$17.04 million	31.03	-$16.18 million	($1.69)	-9.33

PPG Industries has higher revenue and earnings than Westaim. Westaim is trading at a lower price-to-earnings ratio than PPG Industries, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for PPG Industries and Westaim, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PPG Industries	1	9	6	1	2.41
Westaim	0	0	0	0	0.00

PPG Industries currently has a consensus price target of $123.64, suggesting a potential upside of 23.63%. Given PPG Industries’ stronger consensus rating and higher probable upside, equities research analysts clearly believe PPG Industries is more favorable than Westaim.

Summary

PPG Industries beats Westaim on 15 of the 18 factors compared between the two stocks.

About PPG Industries

PPG Industries, Inc. manufactures and distributes paints, coatings, and specialty materials in the United States, Canada, the Asia Pacific, Latin America, Europe, the Middle East, and Africa. It operates through two segments, Performance Coatings and Industrial Coatings. The Performance Coatings segment offers coatings, solvents, adhesives, sealants, sundries, and software for automotive and commercial transport/fleet repair and refurbishing, light industrial coatings, and specialty coatings for signs; wood stains; paints, thermoplastics, pavement marking products, and other advanced technologies for pavement marking for government, commercial infrastructure, painting, and maintenance contractors; and coatings, sealants, transparencies, transparent armor, adhesives, engineered materials, and packaging and chemical management services for commercial, military, regional jet, and general aviation aircraft. The Industrial Coatings segment offers coatings, adhesives and sealants, and metal pretreatments, as well as services and coatings applications for appliances, agricultural and construction equipment, consumer electronics, automotive parts and accessories, building products, kitchenware, and transportation vehicles and other finished products; and on-site coatings services. It also provides coatings for metal cans, closures, plastic and aluminum tubes for food, beverage and personal care, promotional, and specialty packaging; amorphous precipitated silica for tire, battery separator, and other end-uses; TESLIN substrates for labels, e-passports, drivers' licenses, breathable membranes, and loyalty and identification cards; and organic light emitting diode materials, displays and lighting lens materials, optical lenses, color-change products, and photochromic dyes. PPG Industries, Inc. was incorporated in 1883 and is headquartered in Pittsburgh, Pennsylvania.

About Westaim

The Westaim Corporation is a private equity firm specializing in direct and indirect investments through acquisitions, joint ventures, secondary investments both direct and indirect, fund of fund investments, and other arrangements. For direct investments, the firm invests in early venture, mid venture, late venture, middle market, later stage, mature, emerging growth, PIPEs, and buyout transactions. For fund of fund investments, it seeks to invest in private equity funds, venture capital funds, and hedge funds. The firm seeks to provide long term capital to businesses operating in the global financial services industry. It typically acquires controlling interests in businesses. The firm seeks to acquire debt, equity, or derivative securities of both public and private companies. It invests with the objective of providing its shareholders with capital appreciation and real wealth preservation. The firm seeks to provide its portfolio companies with advisory services including, but not limited to, advice on capital allocation, financing strategy, performance measurement and merger and acquisition support. It also seeks to partner with like-minded providers of third party capital to help supplement the firm's own capital, when completing acquisitions. The firm generally seeks to hold its investments for seven to 15 years. The Westaim Corporation was founded in 1996 and is based in Toronto, Canada.