Stora Enso Oyj (OTCMKTS:SEOAY – Get Free Report) and Sylvamo (NYSE:SLVM – Get Free Report) are both basic materials companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, analyst recommendations, risk, institutional ownership, profitability and earnings.
Dividends
Stora Enso Oyj pays an annual dividend of $0.12 per share and has a dividend yield of 1.1%. Sylvamo pays an annual dividend of $1.80 per share and has a dividend yield of 3.8%. Stora Enso Oyj pays out -75.0% of its earnings in the form of a dividend. Sylvamo pays out 26.3% 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. Sylvamo has increased its dividend for 3 consecutive years. Sylvamo is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Analyst Recommendations
This is a breakdown of recent ratings for Stora Enso Oyj and Sylvamo, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Stora Enso Oyj | 2 | 0 | 0 | 0 | 1.00 |
| Sylvamo | 1 | 1 | 1 | 0 | 2.00 |
Insider & Institutional Ownership
0.0% of Stora Enso Oyj shares are owned by institutional investors. Comparatively, 91.2% of Sylvamo shares are owned by institutional investors. 8.1% of Stora Enso Oyj shares are owned by insiders. Comparatively, 0.7% of Sylvamo shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Risk & Volatility
Stora Enso Oyj has a beta of 0.84, indicating that its share price is 16% less volatile than the S&P 500. Comparatively, Sylvamo has a beta of 1.01, indicating that its share price is 1% more volatile than the S&P 500.
Valuation & Earnings
This table compares Stora Enso Oyj and Sylvamo”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Stora Enso Oyj | $9.79 billion | 0.87 | -$146.08 million | ($0.16) | -67.44 |
| Sylvamo | $3.77 billion | 0.50 | $302.00 million | $6.84 | 6.84 |
Sylvamo has lower revenue, but higher earnings than Stora Enso Oyj. Stora Enso Oyj is trading at a lower price-to-earnings ratio than Sylvamo, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Stora Enso Oyj and Sylvamo’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Stora Enso Oyj | -1.18% | -3.89% | -1.99% |
| Sylvamo | 7.71% | 32.60% | 10.64% |
Summary
Sylvamo beats Stora Enso Oyj on 13 of the 17 factors compared between the two stocks.
About Stora Enso Oyj
Stora Enso Oyj provides renewable solutions for the packaging, biomaterials, wooden constructions, and paper industries in Finland and internationally. It operates through Packaging Materials, Packaging Solutions, Biomaterials, Wood Products, Forest, Paper, and Other segments. The company's Packaging Materials segment offers virgin and recycled fiber replace fossil-based materials with low-carbon, renewable and recyclable packaging materials for food and beverage, pharmaceutical, and transport packaging. Its Packaging Solutions segment develops and sells fiber-based packaging products and services, including converting corrugated boards and carton boards; and new materials, such as formed fiber and wood foams into standard and bespoke packaging solutions for retail, e-commerce, and industrials. The company's Biomaterials segment provides various pulp for packaging, paper, tissue, specialties, and hygiene product producers; and tall oil and turpentine from biomass. Its Wood Products segment offers wood-based solutions, including digital tools for design and construction of building projects with wood; applications for windows and doors; and pellets for sustainable heating solutions. The company's Forest segment engages in sustainable forest management, as well as supplies wood. Its Paper segments offers portfolio of products for print and office use. The company's Other segment produces electricity and heat. It serves packaging manufacturers, brand owners, paper merchants, publishers, retailers, printing houses, converters, and construction companies. The company was incorporated in 1996 and is headquartered in Helsinki, Finland.
About Sylvamo
Sylvamo Corporation produces and markets uncoated freesheet for cutsize, offset paper, and pulp in Latin America, Europe, and North America. The company operates through Europe, Latin America, and North America segments. The Europe segment offers copy, tinted, and colored laser printing paper under REY Adagio and Pro-Design brands; and graphic and high-speed inkjet printing papers under the brand Jetstar; as well as produces uncoated freesheet papers. The Latin America segment focuses on uncoated freesheet paper under Chamex, Chamequinho and Chambril brands, as well as produces HP papers. This segment also operates integrated mills and non-integrated mills. The North America segment offers imaging, commercial printing, and converting papers, as well as uncoated papers under Hammermill, Springhill, Williamsburg, Accent, DRM and Postmark brand names. It distributes its products through a variety of channels, including retail merchants, e-commerce, agents, resellers, and paper distributors. The company was founded in 1898 and is headquartered in Memphis, Tennessee.
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