Comparing Asahi Kasei (OTCMKTS:AHKSY) and International Flavors & Fragrances (NYSE:IFF)

International Flavors & Fragrances (NYSE:IFF) and Asahi Kasei (OTCMKTS:AHKSY) are both large-cap materials companies, but which is the better business? We will contrast the two companies based on the strength of their dividends, risk, valuation, earnings, institutional ownership, analyst recommendations and profitability.

Dividends

International Flavors & Fragrances pays an annual dividend of $1.60 per share and has a dividend yield of 1.9%. Asahi Kasei pays an annual dividend of $0.33 per share and has a dividend yield of 1.6%. International Flavors & Fragrances pays out 146.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Asahi Kasei pays out 17.9% of its earnings in the form of a dividend.

Volatility and Risk

International Flavors & Fragrances has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500. Comparatively, Asahi Kasei has a beta of 0.53, meaning that its share price is 47% less volatile than the S&P 500.

Valuation and Earnings

This table compares International Flavors & Fragrances and Asahi Kasei”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
International Flavors & Fragrances	$10.89 billion	1.97	-$361.00 million	$1.09	77.21
Asahi Kasei	$20.42 billion	0.69	$1.05 billion	$1.84	10.98

Asahi Kasei has higher revenue and earnings than International Flavors & Fragrances. Asahi Kasei is trading at a lower price-to-earnings ratio than International Flavors & Fragrances, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

96.0% of International Flavors & Fragrances shares are owned by institutional investors. 1.1% of International Flavors & Fragrances shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares International Flavors & Fragrances and Asahi Kasei’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
International Flavors & Fragrances	2.78%	7.11%	3.96%
Asahi Kasei	6.10%	8.58%	4.31%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for International Flavors & Fragrances and Asahi Kasei, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
International Flavors & Fragrances	1	6	12	0	2.58
Asahi Kasei	0	1	0	1	3.00

International Flavors & Fragrances currently has a consensus price target of $91.40, suggesting a potential upside of 8.60%. Given International Flavors & Fragrances’ higher probable upside, equities analysts clearly believe International Flavors & Fragrances is more favorable than Asahi Kasei.

Summary

Asahi Kasei beats International Flavors & Fragrances on 9 of the 17 factors compared between the two stocks.

About International Flavors & Fragrances

International Flavors & Fragrances, Inc. engages in the manufacture and supply of flavors and fragrances used in the food, beverage, personal care, and household products industries. It operates through the following segments: Nourish, Health & Biosciences, Scent and Pharma Solutions. The Nourish segment consists of legacy Taste segment combined with N&B’s Food & Beverage division and the food protection business of N&B’s Health & Biosciences division. The Health & Biosciences business consists of a biotechnology-driven portfolio of enzymes, food cultures, probiotics and specialty ingredients for food, home and personal care, and health and wellness applications. The Scent business creates fragrance compounds, fragrance ingredients and cosmetic ingredients that are integral elements in the world’s finest perfumes and best-known household and personal care products. The Pharma Solutions business produces a vast portfolio including cellulosics and seaweed-based pharma excipients, used to improve the functionality and delivery of active pharmaceutical ingredients, including controlled or modified drug release formulations, and enabling. The company was founded in 1833 and is headquartered in New York, NY.

About Asahi Kasei

Asahi Kasei Corporation manufactures and sells chemicals. It offers caustic soda, chemical fertilizers, nitric acid, ammonia, acrylonitrile, methyl methacrylate, styrene, adipic acid, hexamethylene diamine, AH salt, propionitrile, sodium cyanide, acetonitrile, methacrylonitrile, cyclohexyl methacrylate, polyethylenes, polyethylenes powder, PMMA resin, polystyrene, polybutadiene rubbers, styrene/butadiene rubbers, clear styrenic copolymer, styrenic thermoplastic elastomer, hydrogenated styrenic elastomers, membranes and systems, functional materials, foams, purging compound, polyisocyanates, polycarbonatediol, aluminum paste, latex, photopolymers and platemaking systems, films, cyclohexanol, cyclohexane, and cyclohexene. The company also offers lithium-ion battery and lead-acid battery separators, plastic optical fibers, artificial suede, nylon 66 filament, polyamide 66, polyacetal, polyphenyene ether, polypropylene compounds, 3D cubic knitted fabric, noise suppression sheets, audio devices, photosensitive polyimide/PBO precursor, latent hardeners, glass fabrics, specialty products, explosion-bonded metal clads, lining fabrics, cupro and stretch fibers, oil-water separators, cellulose nanobeads, and flame-resistant and synthetic fiber; magnetic, current, and gas sensors; deodorizing, spunbond, cupro, multifunctional, and heat-press formable thermoplastic nonwoven; and ecorise, biocradle, and bemliese products. It provides bags and containers; cooking products; cleaners; plastic packet cutting products; cyclohexyl methacrylate, bonded anchors, and microcrystalline cellulose; pharmaceuticals and diagnostic reagents, dialyzers, therapeutic apheresis, virus removal filters, defibrillators, AEDs, automated CPRs, fluid resuscitation pumps, wearable defibrillators, temperature management systems, and data solutions; construction materials; and remodeling services, as well as develops homes and apartments. The company was founded in 1922 and is headquartered in Tokyo, Japan.