Critical Survey: West Fraser Timber (NYSE:WFG) and Svenska Cellulosa Aktiebolaget SCA (publ) (OTCMKTS:SCABY)

Svenska Cellulosa Aktiebolaget SCA (publ) (OTCMKTS:SCABY) and West Fraser Timber (NYSE:WFG) are both materials companies, but which is the better stock? We will compare the two companies based on the strength of their risk, dividends, institutional ownership, earnings, analyst recommendations, profitability and valuation.

Institutional & Insider Ownership

40.2% of West Fraser Timber shares are owned by institutional investors. 1.8% of West Fraser Timber shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Svenska Cellulosa Aktiebolaget SCA (publ) and West Fraser Timber”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Svenska Cellulosa Aktiebolaget SCA (publ)	N/A	N/A	N/A	N/A	N/A
West Fraser Timber	$5.46 billion	0.99	-$937.00 million	($15.44)	-4.46

Svenska Cellulosa Aktiebolaget SCA (publ) has higher earnings, but lower revenue than West Fraser Timber.

Profitability

This table compares Svenska Cellulosa Aktiebolaget SCA (publ) and West Fraser Timber’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Svenska Cellulosa Aktiebolaget SCA (publ)	N/A	N/A	N/A
West Fraser Timber	-22.98%	-10.84%	-8.19%

Analyst Ratings

This is a summary of current ratings for Svenska Cellulosa Aktiebolaget SCA (publ) and West Fraser Timber, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Svenska Cellulosa Aktiebolaget SCA (publ)	0	2	0	0	2.00
West Fraser Timber	1	3	4	0	2.38

West Fraser Timber has a consensus price target of $83.20, indicating a potential upside of 20.77%. Given West Fraser Timber’s stronger consensus rating and higher probable upside, analysts plainly believe West Fraser Timber is more favorable than Svenska Cellulosa Aktiebolaget SCA (publ).

Summary

West Fraser Timber beats Svenska Cellulosa Aktiebolaget SCA (publ) on 6 of the 9 factors compared between the two stocks.

About Svenska Cellulosa Aktiebolaget SCA (publ)

Svenska Cellulosa Aktiebolaget SCA (publ), a forest products company, develops, manufactures, and sells forest, wood, pulp, and containerboard products in Sweden, the United States, Germany, the United Kingdom, rest of Europe, Asia, and internationally. It operates through five segments: Forest, Wood, Pulp, Containerboard, and Renewable Energy. The company offers various sawn wood products; wood solutions for industrial buildings comprise construction timber, outer panels, dimensionally planed timber, laths, base rafters, planks, and shaped timber products; wood solutions for merchants include joists, batten, and untreated and painted outer panel, as well as pressure-impregnated wood products; and marine and land transportation services, including forwarding services using RoRo vessels, container express, and road and rail. It also provides pulp products; bleached softwood kraft pulp and chemical thermomechanical pulp; and Kraftliner products for consumer durables, electronics, hazardous goods, industrial products, fruit and vegetables, frozen foods, etc. In addition, the company engages in the generation of energy from wind power projects, bioenergy, and liquid and solid biofuels; and manufacturing and sale of pellets. Svenska Cellulosa Aktiebolaget SCA (publ) was incorporated in 1915 and is headquartered in Sundsvall, Sweden.

About West Fraser Timber

West Fraser Timber Co. Ltd., a diversified wood products company, engages in manufacturing, selling, marketing, and distributing lumber, engineered wood products, pulp, newsprint, wood chips, and other residuals and renewable energy. It offers spruce-pine-fir, douglas fir-larch, hem-fir, and southern yellow pine lumber, treated wood products, medium density fiberboard panels and plywood, oriented strand board, and laminated veneer lumber wood products, as well as particleboards. The company also provides northern bleached softwood Kraft pulp and bleached chemical thermo-mechanical pulp used to produce various paper products, including printing and writing papers, paperboard products, tissue and towel products, and a variety of other paper grades. Further, it offers bioproducts, including bioenergy and biomaterial. Its products are used in home construction, repair and remodeling, papers, tissue, and box materials, and industrial applications. The company sells its products to major retail chains, contractor supply yards, and wholesalers, as well as industrial customers for further processing or as components for other products in Canada, the United States, the United Kingdom, Europe, and internationally. West Fraser Timber Co. Ltd. was founded in 1955 and is headquartered in Vancouver, Canada.