Contrasting OMNOVA Solutions (OMN) and Kraton Corporation (KRA)
Kraton Corporation (NYSE: KRA) and OMNOVA Solutions (NYSE:OMN) are both small-cap basic materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, analyst recommendations, valuation and profitability.
Institutional and Insider Ownership
95.4% of Kraton Corporation shares are owned by institutional investors. Comparatively, 87.4% of OMNOVA Solutions shares are owned by institutional investors. 5.0% of Kraton Corporation shares are owned by company insiders. Comparatively, 4.8% of OMNOVA Solutions shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
This is a breakdown of recent recommendations for Kraton Corporation and OMNOVA Solutions, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Kraton Corporation currently has a consensus target price of $60.00, indicating a potential upside of 26.48%. OMNOVA Solutions has a consensus target price of $12.00, indicating a potential upside of 18.23%. Given Kraton Corporation’s higher possible upside, equities analysts clearly believe Kraton Corporation is more favorable than OMNOVA Solutions.
Risk and Volatility
Kraton Corporation has a beta of 1.21, indicating that its share price is 21% more volatile than the S&P 500. Comparatively, OMNOVA Solutions has a beta of 2.22, indicating that its share price is 122% more volatile than the S&P 500.
Earnings and Valuation
This table compares Kraton Corporation and OMNOVA Solutions’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Kraton Corporation||$1.74 billion||0.85||$107.30 million||$0.76||62.42|
|OMNOVA Solutions||$759.90 million||0.60||-$400,000.00||($0.13)||-78.08|
Kraton Corporation has higher revenue and earnings than OMNOVA Solutions. OMNOVA Solutions is trading at a lower price-to-earnings ratio than Kraton Corporation, indicating that it is currently the more affordable of the two stocks.
This table compares Kraton Corporation and OMNOVA Solutions’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Kraton Corporation beats OMNOVA Solutions on 9 of the 12 factors compared between the two stocks.
About Kraton Corporation
Kraton Corporation, formerly Kraton Performance Polymers, Inc., is a specialty chemicals company. The Company manufactures styrenic block copolymers (SBCs) and other engineered polymers. The Company also produces specialty products primarily derived from pine wood pulping co-products. The Company operates through two segments: Polymer Segment, which comprises SBCs and other engineered polymers business, and Chemical Segment, which comprises pine-based specialty products business. Its SBCs are used in a range of applications, including adhesives, coatings, consumer and personal care products, sealants, lubricants, medical, packaging, automotive, paving, roofing and footwear products. The Company also sells isoprene rubber (IR) and isoprene rubber latex (IRL), which are non-SBC products primarily used in applications, such as medical products, personal care, adhesives, tackifiers, paints and coatings. It offers crude tall oil (CTO) and crude sulfate turpentine (CST).
About OMNOVA Solutions
OMNOVA Solutions Inc. is a provider of emulsion polymers, specialty chemicals and engineered surfaces for commercial, industrial and residential end uses. The Company’s segments include Performance Chemicals and Engineered Surfaces. The Performance Chemicals segment produces a range of emulsion polymers and specialty chemicals based on styrene butadiene, styrene butadiene acrylonitrile, styrene butadiene vinyl pyridine, nitrile butadiene, polyvinyl acetate, acrylic, styrene acrylic, vinyl acrylic, glyoxal, fluorochemical and bio-based chemistries. The Engineered Surfaces segment develops, designs, produces and markets a line of functional and decorative surfacing products, including coated fabrics, vinyl, paper, and specialty laminates and industrial films. The Performance Chemicals segment includes two product lines: Performance Materials and Specialty Chemicals, and the Engineered Surfaces segment includes two product lines: Coated Fabrics, and Laminates and Performance Films.
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