Eastman Chemical (NYSE: EMN) and Calgon Carbon Corporation (NYSE:CCC) are both basic materials companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, profitability, earnings, risk, analyst recommendations, institutional ownership and dividends.

Profitability

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

Net Margins Return on Equity Return on Assets
Eastman Chemical 10.11% 22.54% 6.74%
Calgon Carbon Corporation 1.27% 5.46% 2.81%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Eastman Chemical and Calgon Carbon Corporation, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Eastman Chemical 0 4 5 0 2.56
Calgon Carbon Corporation 0 2 2 0 2.50

Eastman Chemical currently has a consensus price target of $90.00, indicating a potential upside of 4.96%. Calgon Carbon Corporation has a consensus price target of $17.75, indicating a potential upside of 44.31%. Given Calgon Carbon Corporation’s higher possible upside, analysts plainly believe Calgon Carbon Corporation is more favorable than Eastman Chemical.

Institutional and Insider Ownership

82.1% of Eastman Chemical shares are held by institutional investors. Comparatively, 85.2% of Calgon Carbon Corporation shares are held by institutional investors. 1.1% of Eastman Chemical shares are held by insiders. Comparatively, 2.3% of Calgon Carbon Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

Eastman Chemical has a beta of 1.28, meaning that its stock price is 28% more volatile than the S&P 500. Comparatively, Calgon Carbon Corporation has a beta of 1.09, meaning that its stock price is 9% more volatile than the S&P 500.

Dividends

Eastman Chemical pays an annual dividend of $2.04 per share and has a dividend yield of 2.4%. Calgon Carbon Corporation pays an annual dividend of $0.20 per share and has a dividend yield of 1.6%. Eastman Chemical pays out 32.3% of its earnings in the form of a dividend. Calgon Carbon Corporation pays out 133.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Eastman Chemical has increased its dividend for 5 consecutive years. Eastman Chemical is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Eastman Chemical and Calgon Carbon Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Eastman Chemical $9.20 billion 1.35 $2.15 billion $6.32 13.57
Calgon Carbon Corporation $557.15 million 1.12 $80.63 million $0.15 82.00

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

Summary

Eastman Chemical beats Calgon Carbon Corporation on 13 of the 17 factors compared between the two stocks.

Eastman Chemical Company Profile

Eastman Chemical Company (Eastman) is an advanced materials and specialty additives company. The Company’s segments include Additives & Functional Products (AFP), Advanced Materials (AM), Chemical Intermediates (CI), and Fibers. In the AFP segment, it manufactures chemicals for products in the coatings, tires, consumables, building and construction, industrial applications, including solar energy markets, animal nutrition, care chemicals, crop protection, and energy markets. In the AM segment, it produces and markets its polymers, films, and plastics with differentiated performance properties for end uses in transportation, consumables, building and construction, durable goods, and health and wellness products. The CI segment leverages large scale and vertical integration from the cellulose and acetyl, olefins, and alkylamines streams to support its specialty operating segments. Its product lines in Fibers segment include Acetate Tow, Acetate Yarn and Acetyl Chemical Products.

Calgon Carbon Corporation Company Profile

Calgon Carbon Corporation is a manufacturer of activated carbon, with capabilities in ultraviolet (UV) light disinfection. The Company provides purification solutions for drinking water, wastewater, pollution abatement, and a range of industrial and commercial manufacturing processes. The Company operates through four segments: Activated Carbon and Service, Equipment, Consumer and Other. The Company’s products and services are designed to protect human health and the environment from harmful contaminants in water, and air. The Company provides purification solutions for drinking water, wastewater, pollution abatement, and a range of industrial and commercial manufacturing processes. The Company operates in the United States, Europe, Japan, Africa, Canada, China, India, Latin America, and in other parts of Asia.

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