Reviewing Shin-Etsu Chemical (OTCMKTS:SHECY) & Olin (NYSE:OLN)

Olin (NYSE:OLN) and Shin-Etsu Chemical (OTCMKTS:SHECY) are both basic materials companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, valuation, risk, analyst recommendations, earnings, dividends and institutional ownership.

Volatility and Risk

Olin has a beta of 1.66, suggesting that its share price is 66% more volatile than the S&P 500. Comparatively, Shin-Etsu Chemical has a beta of 1.37, suggesting that its share price is 37% more volatile than the S&P 500.

Valuation & Earnings

This table compares Olin and Shin-Etsu Chemical”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Olin	$6.79 billion	0.37	$108.60 million	$0.46	48.21
Shin-Etsu Chemical	$16.82 billion	3.60	$3.56 billion	$0.87	17.53

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

Insider & Institutional Ownership

88.7% of Olin shares are owned by institutional investors. Comparatively, 0.0% of Shin-Etsu Chemical shares are owned by institutional investors. 1.6% of Olin shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Olin	0.79%	3.36%	0.89%
Shin-Etsu Chemical	19.32%	10.77%	9.06%

Dividends

Olin pays an annual dividend of $0.80 per share and has a dividend yield of 3.6%. Shin-Etsu Chemical pays an annual dividend of $0.23 per share and has a dividend yield of 1.5%. Olin pays out 173.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Shin-Etsu Chemical pays out 26.4% of its earnings in the form of a dividend.

Analyst Recommendations

This is a summary of current recommendations for Olin and Shin-Etsu Chemical, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Olin	2	11	2	1	2.13
Shin-Etsu Chemical	0	1	0	0	2.00

Olin currently has a consensus price target of $25.00, suggesting a potential upside of 12.73%. Given Olin’s stronger consensus rating and higher probable upside, research analysts clearly believe Olin is more favorable than Shin-Etsu Chemical.

Summary

Olin beats Shin-Etsu Chemical on 9 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 Shin-Etsu Chemical

Shin-Etsu Chemical Co., Ltd. provides infrastructure, electronics, and functional materials in Japan. It is also involved in processing and specialized related services. The company operates through Infrastructure Materials; Electronics Materials; Functional Materials; and Processing and Specialized Services segments. In addition, it offers cellulose derivatives, synthetic pheromones, aroma chemicals, dielectric and LED/ semiconductor materials, silanes, photoresists, chlorides, caustic soda, liquid fluoroelastomers, polyvinyl chloride and vinyl acetate resin, silicones, and silicones processed goods. Further, the company offers pellicles, photomask blanks, synthetic quartz/ quartz cloth, pyrolytic boron nitride, LIB anode material, and silicon metal. Additionally, it provides rare earth magnets, compound semiconductors, and oxide single crystals. The company was formerly known as Shin-Etsu Nitrogen Fertilizer Co., Ltd. and changed its name to Shin-Etsu Chemical Co., Ltd. in 1940. Shin-Etsu Chemical Co., Ltd. was incorporated in 1926 and is headquartered in Tokyo, Japan.