Critical Analysis: Cascades (CADNF) and Its Competitors

Cascades (OTCMKTS:CADNF) is one of 70 public companies in the “Containers & Packaging” industry, but how does it compare to its competitors? We will compare Cascades to related businesses based on the strength of its valuation, dividends, earnings, risk, analyst recommendations, institutional ownership and profitability.

Dividends

Cascades pays an annual dividend of $0.16 per share and has a dividend yield of 1.3%. Cascades pays out -16.0% of its earnings in the form of a dividend. As a group, “Containers & Packaging” companies pay a dividend yield of 4.7% and pay out -80.1% of their earnings in the form of a dividend. Cascades lags its competitors as a dividend stock, given its lower dividend yield and higher payout ratio.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Cascades and its competitors, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cascades	0	1	4	0	2.80
Cascades Competitors	383	2326	3387	84	2.51

As a group, “Containers & Packaging” companies have a potential upside of 31.22%. Given Cascades’ competitors higher probable upside, analysts plainly believe Cascades has less favorable growth aspects than its competitors.

Institutional and Insider Ownership

21.8% of Cascades shares are owned by institutional investors. Comparatively, 54.4% of shares of all “Containers & Packaging” companies are owned by institutional investors. 13.5% of shares of all “Containers & Packaging” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Cascades and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cascades	N/A	N/A	N/A
Cascades Competitors	-28.70%	-31.74%	2.17%

Valuation & Earnings

This table compares Cascades and its competitors top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Cascades	N/A	N/A	-12.54
Cascades Competitors	$6.06 billion	$208.36 million	13.57

Cascades’ competitors have higher revenue and earnings than Cascades. Cascades is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Summary

Cascades competitors beat Cascades on 9 of the 13 factors compared.

About Cascades

Cascades Inc. produces, converts, and markets packaging and tissue products in Canada and the United States. The company operates through three segments: Containerboard, Specialty Products, and Tissue Papers. It offers various packaging solutions and tissue products comprised of recycled fibers; tissue papers, comprising parent rolls of virgin and recycled fibres; specialty products, including uncoated recycled boxboards; and containerboards. It also engages in the recovery and recycling activities. Cascades Inc. was incorporated in 1964 and is headquartered in Kingsey Falls, Canada.