Westrock (NYSE: WRK) and MeadWestvaco Corp. (NYSE:MWV) are both basic materials companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, analyst recommendations, institutional ownership, profitability and risk.

Profitability

This table compares Westrock and MeadWestvaco Corp.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Westrock 2.92% 6.38% 2.68%
MeadWestvaco Corp. 2.42% 3.90% 1.34%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Westrock and MeadWestvaco Corp., as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Westrock 0 2 8 1 2.91
MeadWestvaco Corp. 0 0 0 0 N/A

Westrock currently has a consensus price target of $63.00, suggesting a potential upside of 11.56%. Given Westrock’s higher probable upside, research analysts clearly believe Westrock is more favorable than MeadWestvaco Corp..

Earnings & Valuation

This table compares Westrock and MeadWestvaco Corp.’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Westrock $14.41 billion 0.98 $2.12 billion $1.64 34.43
MeadWestvaco Corp. N/A N/A N/A N/A N/A

Westrock has higher revenue and earnings than MeadWestvaco Corp..

Insider and Institutional Ownership

88.6% of Westrock shares are held by institutional investors. 2.7% of Westrock shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Westrock pays an annual dividend of $1.60 per share and has a dividend yield of 2.8%. MeadWestvaco Corp. does not pay a dividend. Westrock pays out 97.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

Westrock beats MeadWestvaco Corp. on 10 of the 11 factors compared between the two stocks.

About Westrock

WestRock Company, incorporated on March 6, 2015, is a multinational provider of paper and packaging solutions for consumer and corrugated packaging markets. The Company also develops real estate in the Charleston, South Carolina region. The Company’s segments include Corrugated Packaging, Consumer Packaging, and Land and Development. The Corrugated Packaging segment consists of its containerboard mill and corrugated packaging operations, as well as its recycling operations. The Consumer Packaging segment consists of consumer mills, folding carton, beverage, merchandising displays, and partition operations. The Land and Development segment is engaged in the development and sale of real estate primarily in Charleston, South Carolina.

About MeadWestvaco Corp.

MeadWestvaco Corporation (MWV) is a global packaging company. The company’s segments include Food & Beverage, Home, Health & Beauty, Industrial, Specialty Chemicals, and Community Development and Land Management. The Food & Beverage segment produces packaging materials, and designs and produces packaging solutions for the food, food service, beverage, dairy, tobacco end markets and paperboard for commercial printing. The Home, Health & Beauty segment offers packaging solutions for the personal care, fragrance, home care, lawn and garden, prescription drug and healthcare end markets. The Industrial segment designs and produces corrugated packaging solutions, for produce, meat, consumer products and bulk goods. The Specialty Chemicals segment manufactures, markets and distributes specialty chemicals. The Community Development and Land Management segment is responsible for maximizing the value of its 94,000 development acres in the Charleston, South Carolina region.

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