Westaim (OTCMKTS:WEDXF) versus Nissan Chemical (OTCMKTS:NNCHY) Critical Contrast

Nissan Chemical (OTCMKTS:NNCHY) and Westaim (OTCMKTS:WEDXF) are both basic materials companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, risk, valuation, earnings and dividends.

Dividends

Nissan Chemical pays an annual dividend of $0.57 per share and has a dividend yield of 1.6%. Westaim pays an annual dividend of $0.09 per share and has a dividend yield of 0.5%. Nissan Chemical pays out 25.4% of its earnings in the form of a dividend. Westaim pays out -5.3% 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.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Nissan Chemical and Westaim, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nissan Chemical	0	1	0	0	2.00
Westaim	0	0	0	0	0.00

Volatility & Risk

Nissan Chemical has a beta of -0.2, indicating that its stock price is 120% less volatile than the S&P 500. Comparatively, Westaim has a beta of 0.19, indicating that its stock price is 81% less volatile than the S&P 500.

Profitability

This table compares Nissan Chemical and Westaim’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nissan Chemical	17.25%	19.00%	13.59%
Westaim	-123.33%	-6.91%	-6.03%

Earnings & Valuation

This table compares Nissan Chemical and Westaim”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nissan Chemical	$1.65 billion	2.99	$284.08 million	$2.24	16.24
Westaim	$17.04 million	36.11	-$16.18 million	($1.69)	-10.91

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

Summary

Nissan Chemical beats Westaim on 9 of the 12 factors compared between the two stocks.

About Nissan Chemical

Nissan Chemical Corporation engages in the chemicals, performance materials, agricultural chemicals, and pharmaceuticals businesses in Japan and internationally. The company provides high purity chemicals; AdBlue, an urea solution; ammonia, sulfuric, and nitric acid, as well as concrete and civil engineering-related products; TEPIC, an epoxy compound; Melamine Cyanurate, a salt of melamine and iso cyanuric acid; TEPIC-VL, a liquid epoxy compound; TEPIC-FL, a liquid epoxy material; FOLDI-E101, an epoxy reactive diluent; Ecopromote, a nucleating agents for PLA; Nissan Reishi, a health food; phenylphosphonic acid; HI-LITE, a chlorinated isocyanulate; OPTBEADS, a melamine-formaldehyde resin and silica; and FINEOXOCOL, a saturated fatty alcohol and acid. It also offers performance materials comprising display, semiconductor, and inorganic materials; agricultural chemicals, such as herbicides, insecticides, fungicides, etc. for use on agricultural land, as well as in golf courses and parks; and drug substances for antiparasite drugs for animals. In addition, the company provides pharmaceutical products, such as LIVALO, a antihypercholesterolemic agent; LANDEL and FINTE, a long-acting calcium channel blocker; APIs and intermediaries; and manufacturing and process researching services for pharmaceutical ingredients. Further, it develops healthcare, information and communication materials, and environmental and energy materials. The company was formerly known as Nissan Chemical Industries, Ltd. and changed its name to Nissan Chemical Corporation in July 2018. Nissan Chemical Corporation was founded in 1887 and is headquartered in Tokyo, Japan.

About Westaim

The Westaim Corporation is a private equity firm specializing in direct and indirect investments through acquisitions, joint ventures, secondary investments both direct and indirect, fund of fund investments, and other arrangements. For direct investments, the firm invests in early venture, mid venture, late venture, middle market, later stage, mature, emerging growth, PIPEs, and buyout transactions. For fund of fund investments, it seeks to invest in private equity funds, venture capital funds, and hedge funds. The firm seeks to provide long term capital to businesses operating in the global financial services industry. It typically acquires controlling interests in businesses. The firm seeks to acquire debt, equity, or derivative securities of both public and private companies. It invests with the objective of providing its shareholders with capital appreciation and real wealth preservation. The firm seeks to provide its portfolio companies with advisory services including, but not limited to, advice on capital allocation, financing strategy, performance measurement and merger and acquisition support. It also seeks to partner with like-minded providers of third party capital to help supplement the firm's own capital, when completing acquisitions. The firm generally seeks to hold its investments for seven to 15 years. The Westaim Corporation was founded in 1996 and is based in Toronto, Canada.