Financial Contrast: Olin (NYSE:OLN) versus RPM International (NYSE:RPM)

RPM International (NYSE:RPM) and Olin (NYSE:OLN) are both 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.

Profitability

This table compares RPM International and Olin’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RPM International	8.41%	22.45%	8.86%
Olin	-2.08%	-4.76%	-1.17%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for RPM International and Olin, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RPM International	0	4	10	0	2.71
Olin	4	10	1	1	1.94

RPM International currently has a consensus price target of $126.00, suggesting a potential upside of 19.27%. Olin has a consensus price target of $22.62, suggesting a potential upside of 30.05%. Given Olin’s higher probable upside, analysts clearly believe Olin is more favorable than RPM International.

Insider & Institutional Ownership

80.9% of RPM International shares are owned by institutional investors. Comparatively, 88.7% of Olin shares are owned by institutional investors. 1.5% of RPM International shares are owned by company insiders. Comparatively, 1.6% of Olin 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

RPM International pays an annual dividend of $2.16 per share and has a dividend yield of 2.0%. Olin pays an annual dividend of $0.80 per share and has a dividend yield of 4.6%. RPM International pays out 41.9% of its earnings in the form of a dividend. Olin pays out -65.0% 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. RPM International has increased its dividend for 51 consecutive years. Olin is clearly the better dividend stock, given its higher yield and lower payout ratio.

Valuation and Earnings

This table compares RPM International and Olin”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RPM International	$7.86 billion	1.71	$661.39 million	$5.16	20.47
Olin	$6.78 billion	0.29	-$100.50 million	($1.23)	-14.14

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

Volatility & Risk

RPM International has a beta of 1.05, meaning that its stock price is 5% more volatile than the S&P 500. Comparatively, Olin has a beta of 1.2, meaning that its stock price is 20% more volatile than the S&P 500.

Summary

RPM International beats Olin on 11 of the 18 factors compared between the two stocks.

About RPM International

RPM International Inc. manufactures and sells specialty chemicals for the industrial, specialty, and consumer markets worldwide. It offers waterproofing, coating, and traditional roofing systems; sealants, air barriers, tapes, and foams; residential home weatherization systems; roofing and building maintenance services; sealing and bonding, subfloor preparation, flooring, and glazing solutions; resin flooring systems, polyurethane, MMA waterproof, epoxy floor paint and coatings, concrete repair, and protection products; fire stopping and intumescent steel coating, and manufacturing industry solutions; rolled asphalt roofing materials and chemical admixtures; concrete and masonry admixtures, concrete fibers, curing and sealing compounds, structural grouts and mortars, epoxy adhesives, injection resins, polyurethane foams, floor hardeners and toppings, joint fillers, industrial and architectural coatings, decorative color/stains/stamps, and restoration materials; insulated building cladding materials; and concrete form wall systems. It also provides polymer flooring systems; fiberglass reinforced plastic gratings and shapes; corrosion-control coating, containment and railcar lining, fire and sound proofing, and heat and cryogenic insulation products; specialty construction products; amine curing agents, reactive diluents, and epoxy resins; fluorescent colorants and pigments; shellac-based-specialty and marine coatings; fire and water damage restoration, carpet cleaning, and disinfecting products; fuel additives; wood treatments, coatings, and touch-up products; and nail enamels, polishes, and coating components. In addition, it offers solutions for the paint contractors and DIYers, concrete restoration and flooring, metallic and faux finish coatings, cleaners, and hobby paints and cements; and caulks, adhesives, insulating foams, and patches, as well as spackling, glazing, and repair products. The company was incorporated in 1947 and is headquartered in Medina, Ohio.

About Olin

Olin Corporation manufactures and distributes chemical products in the United States, Europe, Asia Pacific, Latin America, and Canada. It operates through three segments: Chlor Alkali Products and Vinyls; Epoxy; and Winchester. The Chlor Alkali Products and Vinyls segment offers chlorine and caustic soda, ethylene dichloride and vinyl chloride monomers, methyl chloride, methylene chloride, chloroform, carbon tetrachloride, perchloroethylene, hydrochloric acid, hydrogen, bleach products, potassium hydroxide, and chlorinated organics intermediates and solvents. The Epoxy segment provides Allylics, such as allyl chloride, epichlorohydrin, and glycerin; aromatics, including acetone, bisphenol, cumene, and phenol; liquid and solid epoxy resins; and converted epoxy resins and additives. The Winchester segment offers sporting ammunition products, including shotshells, small caliber centerfire, and rimfire ammunition products for hunters and recreational shooters, and law enforcement agencies; small caliber military ammunition products for use in infantry and mounted weapons; and industrial products comprising gauge loads and powder-actuated tool loads for maintenance applications in power and concrete industries, and powder-actuated tools in construction industry. The company markets its products through its sales force, as well as directly to various industrial customers, mass merchants, retailers, wholesalers, gun clubs, other distributors, and the U.S. Government and its prime contractors. Olin Corporation was incorporated in 1892 and is based in Clayton, Missouri.