Comparing Eastman Chemical (NYSE:EMN) and Shin-Etsu Chemical (OTCMKTS:SHECY)

Shin-Etsu Chemical (OTCMKTS:SHECY) and Eastman Chemical (NYSE:EMN) are both materials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their earnings, dividends, institutional ownership, risk, profitability, analyst recommendations and valuation.

Volatility & Risk

Shin-Etsu Chemical has a beta of 1.34, suggesting that its share price is 34% more volatile than the S&P 500. Comparatively, Eastman Chemical has a beta of 1.06, suggesting that its share price is 6% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations and price targets for Shin-Etsu Chemical and Eastman Chemical, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shin-Etsu Chemical	0	1	0	0	2.00
Eastman Chemical	0	7	7	0	2.50

Eastman Chemical has a consensus price target of $79.17, indicating a potential upside of 7.61%. Given Eastman Chemical’s stronger consensus rating and higher possible upside, analysts clearly believe Eastman Chemical is more favorable than Shin-Etsu Chemical.

Valuation and Earnings

This table compares Shin-Etsu Chemical and Eastman Chemical”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shin-Etsu Chemical	$17.10 billion	4.54	$3.15 billion	$0.83	23.58
Eastman Chemical	$8.87 billion	0.95	$474.00 million	$3.84	19.16

Shin-Etsu Chemical has higher revenue and earnings than Eastman Chemical. Eastman Chemical is trading at a lower price-to-earnings ratio than Shin-Etsu Chemical, indicating that it is currently the more affordable of the two stocks.

Dividends

Shin-Etsu Chemical pays an annual dividend of $0.19 per share and has a dividend yield of 1.0%. Eastman Chemical pays an annual dividend of $3.36 per share and has a dividend yield of 4.6%. Shin-Etsu Chemical pays out 22.9% of its earnings in the form of a dividend. Eastman Chemical pays out 87.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Eastman Chemical has raised its dividend for 15 consecutive years. Eastman Chemical is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

0.0% of Shin-Etsu Chemical shares are held by institutional investors. Comparatively, 83.7% of Eastman Chemical shares are held by institutional investors. 2.6% of Eastman Chemical shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Shin-Etsu Chemical and Eastman Chemical’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Shin-Etsu Chemical	18.39%	10.49%	8.62%
Eastman Chemical	4.99%	9.46%	3.78%

Summary

Shin-Etsu Chemical beats Eastman Chemical on 9 of the 17 factors compared between the two stocks.

About Shin-Etsu Chemical

Shin-Etsu Chemical Co., Ltd. provides infrastructure, electronics, and functional materials in Japan. It is also involved in processing and specialized related services. The company operates through Infrastructure Materials; Electronics Materials; Functional Materials; and Processing and Specialized Services segments. In addition, it offers cellulose derivatives, synthetic pheromones, aroma chemicals, dielectric and LED/ semiconductor materials, silanes, photoresists, chlorides, caustic soda, liquid fluoroelastomers, polyvinyl chloride and vinyl acetate resin, silicones, and silicones processed goods. Further, the company offers pellicles, photomask blanks, synthetic quartz/ quartz cloth, pyrolytic boron nitride, LIB anode material, and silicon metal. Additionally, it provides rare earth magnets, compound semiconductors, and oxide single crystals. The company was formerly known as Shin-Etsu Nitrogen Fertilizer Co., Ltd. and changed its name to Shin-Etsu Chemical Co., Ltd. in 1940. Shin-Etsu Chemical Co., Ltd. was incorporated in 1926 and is headquartered in Tokyo, Japan.

About Eastman Chemical

Eastman Chemical Company operates as a specialty materials company in the United States, China, and internationally. The company's Additives & Functional Products segment offers amine derivative-based building blocks, intermediates for surfactants, metam-based soil fumigants, and organic acid-based solutions; specialty coalescent and solvents, paint additives, and specialty polymers; and heat transfer and aviation fluids. It serves transportation, personal care, wellness, food, feed, agriculture, building and construction, water treatment, energy, consumables, durables, and electronics markets. Its Advanced Materials segment provides copolyesters, cellulosic biopolymers, cellulose esters, polyvinyl butyral sheets, and window and protective films for value-added end uses in the transportation, durables, electronics, building and construction, medical and pharma, and consumables markets. The company's Chemical Intermediates segment offers olefin and acetyl derivatives, ethylene, and commodity solvents; and primary non-phthalate and phthalate plasticizers, and niche non-phthalate plasticizers for industrial chemicals and processing, building and construction, health and wellness, and food and feed. Its Fibers segment provides cellulose acetate tow, triacetin, cellulose acetate flake, acetic acid, and acetic anhydride for use in filtration media primarily cigarette filters; natural and solution dyed acetate yarns, and staple fiber for use in consumables, and health and wellness markets; and wet-laid nonwoven media, specialty and engineered papers, and cellulose acetate fibers for transportation, industrial, agriculture and mining, and aerospace markets. The company was founded in 1920 and is headquartered in Kingsport, Tennessee.