Critical Contrast: Lee & Man Paper Manufacturing (OTCMKTS:LMPMY) and Stella-Jones (OTCMKTS:STLJF)

Lee & Man Paper Manufacturing (OTCMKTS:LMPMY) and Stella-Jones (OTCMKTS:STLJF) are both materials companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, valuation, earnings, profitability, analyst recommendations, dividends and institutional ownership.

Insider and Institutional Ownership

0.0% of Lee & Man Paper Manufacturing shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Lee & Man Paper Manufacturing and Stella-Jones, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lee & Man Paper Manufacturing	0	0	0	0	0.00
Stella-Jones	0	2	2	0	2.50

Dividends

Lee & Man Paper Manufacturing pays an annual dividend of $0.24 per share and has a dividend yield of 5.2%. Stella-Jones pays an annual dividend of $0.99 per share and has a dividend yield of 2.0%. Lee & Man Paper Manufacturing pays out 6.0% of its earnings in the form of a dividend. Stella-Jones pays out 67.3% 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. Lee & Man Paper Manufacturing is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares Lee & Man Paper Manufacturing and Stella-Jones”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lee & Man Paper Manufacturing	N/A	N/A	N/A	$4.02	1.16
Stella-Jones	$2.50 billion	1.10	$241.19 million	$1.47	34.37

Stella-Jones has higher revenue and earnings than Lee & Man Paper Manufacturing. Lee & Man Paper Manufacturing is trading at a lower price-to-earnings ratio than Stella-Jones, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Lee & Man Paper Manufacturing and Stella-Jones’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lee & Man Paper Manufacturing	N/A	N/A	N/A
Stella-Jones	8.66%	14.92%	7.39%

Summary

Stella-Jones beats Lee & Man Paper Manufacturing on 7 of the 11 factors compared between the two stocks.

About Lee & Man Paper Manufacturing

Lee & Man Paper Manufacturing Limited, an investment holding company, engages in the manufacture and trading of packaging papers, pulps, and tissue papers in the People's Republic of China, Vietnam, Malaysia, Macau, and Hong Kong. The company operates through Packaging Paper, Tissue Paper, and Pulp segments. It offers various pulp products, such as dissolved pulps for use in viscose chemical fibers, bamboo fibers, glass papers, acetate fibers, refined rayons, etc.; unbleached bamboo kraft pulps for use in ecru life papers, environmental table wares, food bags, etc.; and bleached bamboo kraft pulps for use in tissue papers, fine papers, cigarette papers, cup papers, etc. The company also provides containerboard products, including kraft and test linerboards for use in cartons, graphic carton, paper bags, file boxes, paperboards, wall papers, etc.; and corrugating liners for use in corrugated layer and septi-layer of paperboards, and honeycomb-like products. In addition, it offers coated duplex board products for use in graphic cartons, color card printing, and offset printing, as well as in packaging of commodities, household appliances, IT products, medicine/health care products, food products, toys, gifts, ceramic products, stationery products, beverages, etc.; toilet rolls; and unbleached paper for use in various applications, such as baby care, menstruation, facial, sensitive skin, table, kitchen, etc. Lee & Man Paper Manufacturing Limited was founded in 1994 and is headquartered in North Point, Hong Kong.

About Stella-Jones

Stella-Jones Inc. produces and sells pressure-treated wood products in Canada and the United States. It operates through two segments, Pressure-Treated Wood; and Logs and Lumber. The company offers railway ties and timbers for short line and commercial railroad operators; and wood utility poles for electrical utilities and telecommunication companies. It also provides residential lumber and accessories to retailers for outdoor applications; industrial products, which include wood for railway bridges and crossings, marine and foundation pilings, construction timbers, and coal tar-based products; and lumber for local home-building markets. Stella-Jones Inc. was incorporated in 1992 and is headquartered in Saint-Laurent, Canada.