PolyOne (NYSE: POL) and Solutia (NYSE:SOA) are both mid-cap basic materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, dividends, valuation and analyst recommendations.
Insider and Institutional Ownership
93.8% of PolyOne shares are owned by institutional investors. 1.6% of PolyOne shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
This is a breakdown of current recommendations and price targets for PolyOne and Solutia, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
PolyOne currently has a consensus price target of $43.17, indicating a potential downside of 6.59%.
PolyOne pays an annual dividend of $0.54 per share and has a dividend yield of 1.2%. Solutia does not pay a dividend. PolyOne pays out -71.1% of its earnings in the form of a dividend. PolyOne has increased its dividend for 5 consecutive years.
This table compares PolyOne and Solutia’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation & Earnings
This table compares PolyOne and Solutia’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|PolyOne||$3.34 billion||1.12||$165.20 million||($0.76)||-60.80|
PolyOne has higher revenue and earnings than Solutia. PolyOne is trading at a lower price-to-earnings ratio than Solutia, indicating that it is currently the more affordable of the two stocks.
PolyOne beats Solutia on 9 of the 11 factors compared between the two stocks.
PolyOne Company Profile
PolyOne Corporation (PolyOne) provides specialized polymer materials, services and solutions. The Company’s segments include Color, Additives and Inks; Specialty Engineered Materials; Performance Products and Solutions, and PolyOne Distribution. The Color, Additives and Inks segment provides custom color and additive concentrates in solid and liquid form for thermoplastics, dispersions for thermosets. The Specialty Engineered Materials segment provides specialty polymer formulations, services and solutions for designers, assemblers and processors of thermoplastic materials. The Performance Products and Solutions segment consists of the Geon Performance Materials and Producer Services business units. As of December 31, 2016, the PolyOne Distribution segment distributed more than 4,000 grades of engineering and commodity grade resins.
Solutia Company Profile
Solutia Inc., together with its subsidiaries, is a global manufacturer of performance materials and specialty chemicals used in a range of consumer and industrial applications, including interlayers and aftermarket film for automotive and architectural glass; chemicals that promote safety and durability in tires, and encapsulants, coatings and specialty chemicals used in a variety of electronic, industrial and energy solutions. The Company operates in three segments: Advanced Interlayers; Performance Films; and Technical Specialties. On November 23, 2011, the Company acquired Southwall Technologies Inc. (Southwall). In April 2011, the Company sold its Santoweb and Vocol businesses to Rhein Chemie, a wholly owned subsidiary of LANXESS AG.
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