Contrasting Hawkins (NASDAQ:HWKN) & Eastman Chemical (NYSE:EMN)

Hawkins (NASDAQ:HWKN) and Eastman Chemical (NYSE:EMN) are both mid-cap materials companies, but which is the superior stock? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, profitability, institutional ownership, earnings and valuation.

Insider & Institutional Ownership

69.7% of Hawkins shares are owned by institutional investors. Comparatively, 83.7% of Eastman Chemical shares are owned by institutional investors. 3.7% of Hawkins shares are owned by insiders. Comparatively, 2.6% of Eastman Chemical shares are owned by 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.

Analyst Recommendations

This is a summary of recent ratings and price targets for Hawkins and Eastman Chemical, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hawkins	1	2	1	0	2.00
Eastman Chemical	0	8	7	0	2.47

Hawkins currently has a consensus price target of $171.00, indicating a potential upside of 30.14%. Eastman Chemical has a consensus price target of $77.69, indicating a potential upside of 20.97%. Given Hawkins’ higher possible upside, equities research analysts plainly believe Hawkins is more favorable than Eastman Chemical.

Volatility & Risk

Hawkins has a beta of 0.74, indicating that its stock price is 26% less volatile than the S&P 500. Comparatively, Eastman Chemical has a beta of 1.06, indicating that its stock price is 6% more volatile than the S&P 500.

Dividends

Hawkins pays an annual dividend of $0.80 per share and has a dividend yield of 0.6%. Eastman Chemical pays an annual dividend of $3.36 per share and has a dividend yield of 5.2%. Hawkins pays out 20.7% 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. Hawkins has raised its dividend for 20 consecutive years and Eastman Chemical has raised its dividend for 15 consecutive years.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Hawkins	7.29%	15.42%	8.22%
Eastman Chemical	4.99%	9.46%	3.78%

Earnings and Valuation

This table compares Hawkins and Eastman Chemical”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hawkins	$1.08 billion	2.53	$81.55 million	$3.86	34.04
Eastman Chemical	$8.75 billion	0.84	$474.00 million	$3.84	16.73

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

Summary

Hawkins beats Eastman Chemical on 10 of the 17 factors compared between the two stocks.

About Hawkins

Hawkins, Inc. operates as a specialty chemical and ingredients company in the United States. It operates through three segments: Industrial, Water Treatment, and Health and Nutrition. The Industrial segment offers industrial chemicals, products, and services to agriculture, chemical processing, electronics, energy, food, pharmaceutical, and plating industries. This segment manufactures sodium hypochlorite and agricultural products, as well as various food-grade and pharmaceutical products, such as liquid phosphates, lactates, other blended products, and agricultural products; and receives, stores, and distributes various chemicals comprising liquid caustic soda, sulfuric acid, hydrochloric acid, urea, phosphoric acid, aqua ammonia, and potassium hydroxide. It also repackages water treatment chemicals and bulk industrial chemicals; and performs custom blending of chemicals. The Water Treatment segment provides chemicals, products, equipment, services, and solutions for potable water, municipal and industrial wastewater, industrial process water, non-residential swimming pool water, and agriculture water. The Health and Nutrition segment offers ingredient distribution, processing, and formulation solutions to manufacturers of nutraceutical, functional food and beverage, personal care, dietary supplement and other nutritional food, and health and wellness products. Its products portfolio includes minerals, vitamins and amino acids, excipients, joint products, botanicals and herbs, sweeteners, and enzymes. Hawkins, Inc. was founded in 1938 and is headquartered in Roseville, Minnesota.

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.