Celanese (NYSE: CE) and Methanex (NASDAQ:MEOH) are both basic materials companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, risk, institutional ownership, valuation, analyst recommendations and dividends.
Celanese pays an annual dividend of $1.84 per share and has a dividend yield of 1.7%. Methanex pays an annual dividend of $1.20 per share and has a dividend yield of 2.1%. Celanese pays out 30.2% of its earnings in the form of a dividend. Methanex pays out 33.9% 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. Methanex has increased its dividend for 6 consecutive years. Methanex is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
95.0% of Celanese shares are owned by institutional investors. Comparatively, 79.4% of Methanex shares are owned by institutional investors. 0.4% of Celanese shares are owned by company insiders. Comparatively, 1.0% of Methanex shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
This is a breakdown of recent recommendations and price targets for Celanese and Methanex, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Celanese presently has a consensus target price of $113.21, suggesting a potential upside of 4.30%. Methanex has a consensus target price of $60.31, suggesting a potential upside of 6.74%. Given Methanex’s higher probable upside, analysts plainly believe Methanex is more favorable than Celanese.
Earnings & Valuation
This table compares Celanese and Methanex’s gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Celanese||$6.14 billion||2.40||$843.00 million||$6.10||17.80|
|Methanex||$3.06 billion||1.55||$316.13 million||$3.54||15.96|
Celanese has higher revenue and earnings than Methanex. Methanex is trading at a lower price-to-earnings ratio than Celanese, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Celanese has a beta of 1.29, indicating that its share price is 29% more volatile than the S&P 500. Comparatively, Methanex has a beta of 1.79, indicating that its share price is 79% more volatile than the S&P 500.
This table compares Celanese and Methanex’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Celanese beats Methanex on 13 of the 18 factors compared between the two stocks.
Celanese Corporation (Celanese) is a technology and specialty materials company. The Company’s segments include Advanced Engineered Materials, Consumer Specialties, Industrial Specialties, Acetyl Intermediates and Other Activities. The Advanced Engineered Materials segment includes the Company’s engineered materials business and certain affiliates. The Consumer Specialties segment includes the Company’s cellulose derivatives and food ingredients businesses, which serve consumer-driven applications. The Industrial Specialties segment includes the Company’s emulsion polymers and ethylene vinyl acetate (EVA) polymers businesses. The Acetyl Intermediates segment includes the Company’s intermediate chemistry business, which produces and supplies acetyl products, including acetic acid, vinyl acetate monomer (VAM), acetic anhydride and acetate esters. The Company has operations in North America, Europe and Asia. As of December 31, 2016, the Company had 30 global production facilities.
Methanex Corp is a Canada-based producer and supplier of methanol to a range of international markets. The Company operates production sites in Canada, Chile, Egypt, New Zealand, the United States, as well as Trinidad and Tobago. Its global operations are supported by a global supply chain of terminals, storage facilities and a fleet of methanol ocean tankers. The Company’s subsidiary, Waterfront Shipping Company Limited, operates its fleet, which is made up of over 20 vessels ranging from 3,000 to 50,000 deadweight tons of capacity. It has over three production facilities in New Zealand that supply methanol primarily to customers in Asia Pacific. The Company operates over two plants in Trinidad, Titan and Atlas, which supply methanol to markets in North America, Europe, Asia Pacific and South America. Its joint venture facility in Egypt supplies methanol to markets in Europe and Asia Pacific. Its plant in Medicine Hat, Alberta, supplies methanol to customers in North America.
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