Financial Contrast: Mitsubishi Chemical (OTCMKTS:MTLHY) vs. Olin (NYSE:OLN)

Olin (NYSE:OLN) and Mitsubishi Chemical (OTCMKTS:MTLHY) are both mid-cap basic materials companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, risk, institutional ownership, dividends, profitability, valuation and analyst recommendations.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Olin and Mitsubishi Chemical, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Olin	3	12	2	1	2.06
Mitsubishi Chemical	0	0	0	0	0.00

Olin currently has a consensus price target of $23.07, indicating a potential downside of 12.58%. Given Olin’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Olin is more favorable than Mitsubishi Chemical.

Profitability

This table compares Olin and Mitsubishi Chemical’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Olin	-0.63%	-0.47%	-0.12%
Mitsubishi Chemical	0.62%	0.98%	0.38%

Institutional and Insider Ownership

88.7% of Olin shares are held by institutional investors. 1.7% of Olin shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Dividends

Olin pays an annual dividend of $0.80 per share and has a dividend yield of 3.0%. Mitsubishi Chemical pays an annual dividend of $0.69 per share and has a dividend yield of 2.1%. Olin pays out -210.5% of its earnings in the form of a dividend. Mitsubishi Chemical pays out 113.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Olin is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings & Valuation

This table compares Olin and Mitsubishi Chemical”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Olin	$6.78 billion	0.44	-$42.80 million	($0.38)	-69.43
Mitsubishi Chemical	$28.94 billion	0.33	$297.13 million	$0.61	54.93

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

Risk and Volatility

Olin has a beta of 1.64, indicating that its stock price is 64% more volatile than the S&P 500. Comparatively, Mitsubishi Chemical has a beta of 0.64, indicating that its stock price is 36% less volatile than the S&P 500.

Summary

Olin beats Mitsubishi Chemical on 10 of the 17 factors compared between the two stocks.

About Olin

Olin Corporation manufactures and distributes chemical products in the United States, Europe, Asia Pacific, Latin America, and Canada. It operates through three segments: Chlor Alkali Products and Vinyls; Epoxy; and Winchester. The Chlor Alkali Products and Vinyls segment offers chlorine and caustic soda, ethylene dichloride and vinyl chloride monomers, methyl chloride, methylene chloride, chloroform, carbon tetrachloride, perchloroethylene, hydrochloric acid, hydrogen, bleach products, potassium hydroxide, and chlorinated organics intermediates and solvents. The Epoxy segment provides Allylics, such as allyl chloride, epichlorohydrin, and glycerin; aromatics, including acetone, bisphenol, cumene, and phenol; liquid and solid epoxy resins; and converted epoxy resins and additives. The Winchester segment offers sporting ammunition products, including shotshells, small caliber centerfire, and rimfire ammunition products for hunters and recreational shooters, and law enforcement agencies; small caliber military ammunition products for use in infantry and mounted weapons; and industrial products comprising gauge loads and powder-actuated tool loads for maintenance applications in power and concrete industries, and powder-actuated tools in construction industry. The company markets its products through its sales force, as well as directly to various industrial customers, mass merchants, retailers, wholesalers, gun clubs, other distributors, and the U.S. Government and its prime contractors. Olin Corporation was incorporated in 1892 and is based in Clayton, Missouri.

About Mitsubishi Chemical

Mitsubishi Chemical Group Corporation provides performance products, chemicals, industrial gases, health care products, and other products in Japan and internationally. It operates in five segments: Specialty Materials, Industrial Gases, Health Care, MMA, and Basic Materials. The Specialty Materials segment offers performance polymers, soarnol, gohsenol, sustainable polymers, and engineering plastics; coating materials, additives, and fines; packaging, industrial and medical, acetyl, and polyester films; engineering shapes and solutions, carbon fiber and composite materials, and fibers; aqua, life, and infrastructure solutions; and semiconductor, electronics, and battery materials. The Industrial Gases segment provides industrial gases. The Health Care segment offers ethical pharmaceuticals. The MMA segment provides methyl methacrylate (MMA) and polymethyl methacrylate (PMMA). The Basic Materials segment offers basic petrochemicals, polyolefins, and basic chemical derivatives, as well as carbon products. The company provides engineering, transportation, and warehousing services. Mitsubishi Chemical Group Corporation was incorporated in 2005 and is headquartered in Tokyo, Japan.