P H Glatfelter (NYSE: GLT) and Domtar (NYSE:UFS) are both basic materials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, risk, analyst recommendations, profitability, valuation, dividends and institutional ownership.
This table compares P H Glatfelter and Domtar’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|P H Glatfelter||0.13%||6.07%||2.51%|
This table compares P H Glatfelter and Domtar’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|P H Glatfelter||$1.59 billion||0.47||$7.91 million||$1.16||14.86|
|Domtar||$5.16 billion||0.57||-$258.00 million||$2.60||18.05|
P H Glatfelter has higher earnings, but lower revenue than Domtar. P H Glatfelter is trading at a lower price-to-earnings ratio than Domtar, indicating that it is currently the more affordable of the two stocks.
P H Glatfelter pays an annual dividend of $0.52 per share and has a dividend yield of 3.0%. Domtar pays an annual dividend of $1.74 per share and has a dividend yield of 3.7%. P H Glatfelter pays out 44.8% of its earnings in the form of a dividend. Domtar pays out 66.9% 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. P H Glatfelter has raised its dividend for 5 consecutive years and Domtar has raised its dividend for 8 consecutive years. Domtar is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Risk & Volatility
P H Glatfelter has a beta of 1.27, meaning that its stock price is 27% more volatile than the S&P 500. Comparatively, Domtar has a beta of 1.64, meaning that its stock price is 64% more volatile than the S&P 500.
Institutional & Insider Ownership
90.0% of P H Glatfelter shares are owned by institutional investors. Comparatively, 95.3% of Domtar shares are owned by institutional investors. 2.6% of P H Glatfelter shares are owned by company insiders. Comparatively, 1.0% of Domtar shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
This is a breakdown of recent ratings for P H Glatfelter and Domtar, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|P H Glatfelter||0||0||0||0||N/A|
Domtar has a consensus price target of $43.82, suggesting a potential downside of 6.61%. Given Domtar’s higher probable upside, analysts clearly believe Domtar is more favorable than P H Glatfelter.
Domtar beats P H Glatfelter on 12 of the 16 factors compared between the two stocks.
About P H Glatfelter
P. H. Glatfelter Company, together with its subsidiaries, manufactures and sells specialty papers and engineered materials worldwide. The company's Composite Fibers business unit offers food and beverage filtration paper for single-serve coffee and tea products; wall covering base materials for wallpaper manufacturers; metallized products that are used in labels, packaging liners, gift wrap, and other consumer product applications; composite laminate papers for use in production of decorative laminates, furniture, and flooring applications; and special paper products, which are used in electrical energy storage, transport and transmission, wipes, and other engineered fiber-based applications. Its Advanced Airlaid Materials business unit supplies absorbent cellulose-based airlaid nonwoven materials that are used to manufacture consumer products, such as feminine hygiene, specialty wipe, adult incontinence, home care, and other consumer products. The company's Specialty Papers business unit offers carbonless and non-carbonless forms papers for credit card receipts, multi-part forms, security papers, and other end-user applications; engineered products for high speed inkjet printing, office specialty products, greeting cards, and other niche specialty applications; envelope and converting papers for transactional and direct mail envelopes; and book publishing papers for the production of hardbound books and other book publishing needs. P. H. Glatfelter Company markets its products directly, as well as through wholesale paper merchants, brokers, and agents. The company was founded in 1864 and is headquartered in York, Pennsylvania.
Domtar Corporation designs, manufactures, markets, and distributes various communication papers, specialty and packaging papers, and absorbent hygiene products in the United States, Canada, Europe, Asia, and internationally. It operates in two segments, Pulp and Paper, and Personal Care. The company offers business papers, including copy and electronic imaging papers for use with inkjet and laser printers, photocopiers, and plain-paper fax machines, as well as computer papers, preprinted forms, and digital papers for office and home use. It also provides commercial printing and publishing papers, such as offset papers and opaques for sheet and roll fed offset presses; publishing papers comprising tradebook and lightweight uncoated papers for publishing textbooks, dictionaries, catalogs, magazines, hard cover novels, and financial documents; and base papers that are converted into envelopes, tablets, business forms, and data processing/computer forms. In addition, the company offers papers for thermal and flexible packaging, food and medical packaging, medical gowns and drapes, sandpaper backing, carbonless printing, label, and other coating and laminating applications; and papers for industrial and specialty applications that include carrier and treated papers, security papers, and specialized printing and converting applications. Further, it provides softwood, fluff, and hardwood Kraft products for various end products. Additionally, the company offers absorbent hygiene products, which comprise adult incontinence products under the Attends, IncoPack, Indasec, and Reassure brand; and branded and private label briefs, protective underwear, underpads, pads, and washcloths, as well as baby diapers, youth pants, and infant training pants for healthcare, retail, and direct-to-consumer channels. It serves merchants, retail outlets, stationers, printers, publishers, converters, and end-users. The company was incorporated in 2006 and is based in Fort Mill, South Carolina.
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