Critical Analysis: SHOWA DENKO KK/ADR (SHWDY) vs. The Competition

SHOWA DENKO KK/ADR (OTCMKTS: SHWDY) is one of 28 public companies in the “Chemicals & allied products” industry, but how does it weigh in compared to its rivals? We will compare SHOWA DENKO KK/ADR to related businesses based on the strength of its institutional ownership, analyst recommendations, risk, dividends, valuation, profitability and earnings.

Profitability

This table compares SHOWA DENKO KK/ADR and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
SHOWA DENKO KK/ADR N/A N/A N/A
SHOWA DENKO KK/ADR Competitors -44.39% 20.06% 5.40%

Insider & Institutional Ownership

72.3% of shares of all “Chemicals & allied products” companies are owned by institutional investors. 8.9% of shares of all “Chemicals & allied products” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares SHOWA DENKO KK/ADR and its rivals top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
SHOWA DENKO KK/ADR $8.99 billion $1.00 billion 2.73
SHOWA DENKO KK/ADR Competitors $7.49 billion $529.45 million 12.28

SHOWA DENKO KK/ADR has higher revenue and earnings than its rivals. SHOWA DENKO KK/ADR is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Risk & Volatility

SHOWA DENKO KK/ADR has a beta of 1.71, suggesting that its stock price is 71% more volatile than the S&P 500. Comparatively, SHOWA DENKO KK/ADR’s rivals have a beta of 1.87, suggesting that their average stock price is 87% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for SHOWA DENKO KK/ADR and its rivals, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
SHOWA DENKO KK/ADR 0 1 0 0 2.00
SHOWA DENKO KK/ADR Competitors 229 787 1009 49 2.42

As a group, “Chemicals & allied products” companies have a potential upside of 18.00%. Given SHOWA DENKO KK/ADR’s rivals stronger consensus rating and higher possible upside, analysts plainly believe SHOWA DENKO KK/ADR has less favorable growth aspects than its rivals.

Dividends

SHOWA DENKO KK/ADR pays an annual dividend of $0.68 per share and has a dividend yield of 2.8%. SHOWA DENKO KK/ADR pays out 7.6% of its earnings in the form of a dividend. As a group, “Chemicals & allied products” companies pay a dividend yield of 2.2% and pay out 26.5% of their earnings in the form of a dividend. SHOWA DENKO KK/ADR is clearly a better dividend stock than its rivals, given its higher yield and lower payout ratio.

Summary

SHOWA DENKO KK/ADR rivals beat SHOWA DENKO KK/ADR on 10 of the 15 factors compared.

SHOWA DENKO KK/ADR Company Profile

Showa Denko K.K. operates as a chemical company in Japan and internationally. It operates in six segments: Petrochemicals, Chemicals, Electronics, Inorganics, Aluminum, and Others. The Petrochemicals segment offers olefins, including ethylene, propylene, C4 fraction, cracked fuel oils, etc.; and organic chemicals, including vinyl acetate monomer, vinyl and ethyl acetate, allyl alcohol, acetaldehyde, acetic acid, and allyl ester resins, as well as polypropylene. The Chemicals segment provides functional chemicals, such as polymer emulsion and unsaturated polyester resins; industrial gases comprising liquefied carbon dioxide, dry ice, oxygen, nitrogen, hydrogen, argon, fusing ethylene, and helium; basic chemicals that include liquefied ammonia, acrylonitrile, and chloroprene rubber; and electronic chemicals, which comprise high-purity gases for electronics. The Electronics segment offers aluminum based and glass based hard disks (HDs); aluminum substrates for HDs; LED chips, epitaxial wafers, rare earth magnetic alloys, and lithium-ion battery materials; MOCVD epitaxial wafers; and advanced battery materials. The Inorganics segment provides alumina electrical fillers fused materials, abrasive grains lapping and polishing materials, plasma spraying materials, refractories, alumina for heat-radiation fillers, spherical alumina, hexagonal boron nitride, lubrication and mold-release agents, and polishing materials; and graphite electrodes. The Aluminum segment offers aluminum capacitor foils and aluminum sheets; extruded and forged products, aluminum cylinders, cast rods of aluminum alloys, compressors, heat exchangers, and power semiconductor cooling devices; and aluminum beverage cans. The Others segment engages in the general trading and building materials business; and sells chemicals, resins, metals, and electronic materials. The company was founded in 1908 and is headquartered in Tokyo, Japan.

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