Arkema (OTCMKTS:ARKAY) versus Eastman Chemical (NYSE:EMN) Head-To-Head Contrast

Eastman Chemical (NYSE:EMN) and Arkema (OTCMKTS:ARKAY) are both mid-cap basic materials companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, dividends, profitability, valuation and risk.

Earnings and Valuation

This table compares Eastman Chemical and Arkema”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Eastman Chemical	$9.38 billion	0.75	$905.00 million	$5.99	10.33
Arkema	$10.33 billion	0.44	$383.06 million	$2.08	28.76

Eastman Chemical has higher earnings, but lower revenue than Arkema. Eastman Chemical is trading at a lower price-to-earnings ratio than Arkema, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Eastman Chemical has a beta of 1.24, suggesting that its share price is 24% more volatile than the S&P 500. Comparatively, Arkema has a beta of 0.9, suggesting that its share price is 10% less volatile than the S&P 500.

Institutional and Insider Ownership

83.7% of Eastman Chemical shares are held by institutional investors. 1.9% of Eastman Chemical shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Eastman Chemical and Arkema’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Eastman Chemical	7.75%	12.89%	5.03%
Arkema	1.55%	5.15%	2.70%

Dividends

Eastman Chemical pays an annual dividend of $3.32 per share and has a dividend yield of 5.4%. Arkema pays an annual dividend of $3.03 per share and has a dividend yield of 5.1%. Eastman Chemical pays out 55.4% of its earnings in the form of a dividend. Arkema pays out 145.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Eastman Chemical has raised its dividend for 15 consecutive years. Eastman Chemical is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of current ratings and price targets for Eastman Chemical and Arkema, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Eastman Chemical	0	6	8	0	2.57
Arkema	2	2	1	0	1.80

Eastman Chemical currently has a consensus price target of $78.62, indicating a potential upside of 27.02%. Given Eastman Chemical’s stronger consensus rating and higher possible upside, analysts clearly believe Eastman Chemical is more favorable than Arkema.

Summary

Eastman Chemical beats Arkema on 15 of the 17 factors compared between the two stocks.

About Eastman Chemical

Eastman Chemical Company operates as a specialty materials company in the United States, China, and internationally. The company's Additives & Functional Products segment offers amine derivative-based building blocks, intermediates for surfactants, metam-based soil fumigants, and organic acid-based solutions; specialty coalescent and solvents, paint additives, and specialty polymers; and heat transfer and aviation fluids. It serves transportation, personal care, wellness, food, feed, agriculture, building and construction, water treatment, energy, consumables, durables, and electronics markets. Its Advanced Materials segment provides copolyesters, cellulosic biopolymers, cellulose esters, polyvinyl butyral sheets, and window and protective films for value-added end uses in the transportation, durables, electronics, building and construction, medical and pharma, and consumables markets. The company's Chemical Intermediates segment offers olefin and acetyl derivatives, ethylene, and commodity solvents; and primary non-phthalate and phthalate plasticizers, and niche non-phthalate plasticizers for industrial chemicals and processing, building and construction, health and wellness, and food and feed. Its Fibers segment provides cellulose acetate tow, triacetin, cellulose acetate flake, acetic acid, and acetic anhydride for use in filtration media primarily cigarette filters; natural and solution dyed acetate yarns, and staple fiber for use in consumables, and health and wellness markets; and wet-laid nonwoven media, specialty and engineered papers, and cellulose acetate fibers for transportation, industrial, agriculture and mining, and aerospace markets. The company was founded in 1920 and is headquartered in Kingsport, Tennessee.

About Arkema

Arkema S.A. manufactures and sells specialty chemicals and advanced materials worldwide. The company operates in three segments: Adhesive Solutions, Advanced Materials and Coating Solutions, and Intermediates. The Adhesive Solutions segment provides solutions for construction, renovation of buildings, DIY, durable goods, and packaging and non-woven applications; and supplies technologies used in building activities for businesses and individuals, including sealants, tiles, flooring adhesives and waterproofing systems, and technologies used in industry, which include automotive, textiles, glazing, flexible and rigid packaging, and hygiene markets. This segment also offers performance polymers, such as specialty polyamides, PVDF, polyimides, fluorospecialties, and polyetherketoneketone; and performance additives which includes molecular sieves, organic peroxides, thiochemicals, and hydrogen peroxide. The Advance Materials and Coating Solutions segment offers coating solutions, including comprising EU/US acrylics and coating resins; coating additives, such as sartomer photocure resins and coatex rheology additives. This segment also provides decorative paints, industrial coatings, and adhesives; and solutions for applications in the paper, superabsorbent, water treatment and oil and gas extraction, and 3D printing and electronics industries. The Intermediates segment provides fluorogases and acrylics; and industrial intermediate chemicals used in construction, refrigeration and air conditioning, automotive, coatings, and water treatment sectors. Arkema S.A. was incorporated in 2003 and is headquartered in Colombes, France.