Head to Head Contrast: Sherwin-Williams (NYSE:SHW) vs. Minerals Technologies (NYSE:MTX)

Sherwin-Williams (NYSE:SHW) and Minerals Technologies (NYSE:MTX) are both basic materials companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, risk, profitability, institutional ownership and earnings.

Insider and Institutional Ownership

77.7% of Sherwin-Williams shares are owned by institutional investors. Comparatively, 97.3% of Minerals Technologies shares are owned by institutional investors. 0.6% of Sherwin-Williams shares are owned by company insiders. Comparatively, 3.5% of Minerals Technologies shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Sherwin-Williams and Minerals Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sherwin-Williams	10.90%	65.26%	11.22%
Minerals Technologies	-0.89%	10.22%	5.03%

Dividends

Sherwin-Williams pays an annual dividend of $3.20 per share and has a dividend yield of 0.9%. Minerals Technologies pays an annual dividend of $0.48 per share and has a dividend yield of 0.7%. Sherwin-Williams pays out 31.2% of its earnings in the form of a dividend. Minerals Technologies pays out -94.1% 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. Sherwin-Williams has raised its dividend for 48 consecutive years and Minerals Technologies has raised its dividend for 2 consecutive years. Sherwin-Williams is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Valuation & Earnings

This table compares Sherwin-Williams and Minerals Technologies”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sherwin-Williams	$23.57 billion	3.81	$2.57 billion	$10.27	35.26
Minerals Technologies	$2.07 billion	1.06	-$18.40 million	($0.51)	-138.63

Sherwin-Williams has higher revenue and earnings than Minerals Technologies. Minerals Technologies is trading at a lower price-to-earnings ratio than Sherwin-Williams, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Sherwin-Williams has a beta of 1.25, suggesting that its stock price is 25% more volatile than the S&P 500. Comparatively, Minerals Technologies has a beta of 1.24, suggesting that its stock price is 24% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations and price targets for Sherwin-Williams and Minerals Technologies, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sherwin-Williams	1	5	11	0	2.59
Minerals Technologies	1	1	1	0	2.00

Sherwin-Williams currently has a consensus price target of $387.67, indicating a potential upside of 7.07%. Minerals Technologies has a consensus price target of $89.00, indicating a potential upside of 25.88%. Given Minerals Technologies’ higher possible upside, analysts clearly believe Minerals Technologies is more favorable than Sherwin-Williams.

Summary

Sherwin-Williams beats Minerals Technologies on 13 of the 17 factors compared between the two stocks.

About Sherwin-Williams

The Sherwin-Williams Company engages in the development, manufacture, distribution, and sale of paints, coating, and related products to professional, industrial, commercial, and retail customers. It operates through three segments: Paint Stores Group, Consumer Brands Group, and Performance Coatings Group. The Paint Stores Group segment offers architectural paints and coatings, and protective and marine products, as well as OEM product finishes and related products for architectural and industrial paint contractors, and do-it-yourself homeowners. The Consumer Brands Group segment supplies a portfolio of branded and private-label architectural paints, stains, varnishes, industrial products, wood finishes products, wood preservatives, applicators, corrosion inhibitors, aerosols, caulks, and adhesives to retailers, including home centers and hardware stores, and dedicated dealers and distributors. The Performance Coatings Group segment develops and sells industrial coatings for wood finishing and general industrial applications, automotive refinish products, protective and marine coatings, coil coatings, packaging coatings, and performance-based resins and colorants. It serves retailers, dealers, jobbers, licensees, and other third-party distributors through its branches and direct sales staff, as well as through outside sales representatives. The company has operations primarily in the North and South America, the Caribbean, Europe, Asia, and Australia. The Sherwin-Williams Company was founded in 1866 and is headquartered in Cleveland, Ohio.

About Minerals Technologies

Minerals Technologies Inc. develops, produces, and markets various mineral, mineral-based, and related systems and services. The company operates through two segments, Consumer & Specialties, and Engineered Solutions segments. The Consumer & Specialties segment offers household and personal care products, such as pet litter, personal care, fabric care, edible oil and other fluid purification, animal health, and agricultural products; and specialty additives products, including precipitated calcium carbonate and ground calcium carbonate products that are used in the paper, paperboard, and fiber based packaging industries, as well as automotive, construction, and table and food applications. This segment produces limestone and dolomitic limestone used in construction, automotive, and consumer markets for packaging applications. The Engineered Solutions segment provides high-temperature technology products consisting of custom-blended mineral and non-mineral products for casting auto parts, farm and construction equipment, oil and gas production equipment, power generation turbine castings, and rail car components; and environmental and infrastructure products comprising geosynthetic clay lining systems, vapor intrusion mitigation products, sub surface waterproofing systems, green roofs, wastewater remediation, drinking water purification technologies, and drilling products. In addition, this segment provides chromite products; gunnable monolithic refractory products and application systems; monolithic refractory materials and pre-cast refractory shapes; refractory shapes and linings; carbon composite and pyrolitic graphite; and filtration and well testing services. It markets its products primarily through its direct sales force, as well as regional distributors. The company serves in the United States, Canada, Latin America, Europe, Africa, and Asia. Minerals Technologies Inc. was incorporated in 1968 and is headquartered in New York, New York.