Sherwin-Williams (NYSE:SHW) vs. Toray Industries (OTCMKTS:TRYIY) Head to Head Analysis

Sherwin-Williams (NYSE:SHW) and Toray Industries (OTCMKTS:TRYIY) are both large-cap basic materials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, earnings, valuation, institutional ownership, analyst recommendations, dividends and profitability.

Valuation and Earnings

This table compares Sherwin-Williams and Toray Industries”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sherwin-Williams	$23.57 billion	3.55	$2.57 billion	$10.27	32.90
Toray Industries	$16.83 billion	0.62	$514.21 million	$0.39	35.42

Sherwin-Williams has higher revenue and earnings than Toray Industries. Sherwin-Williams is trading at a lower price-to-earnings ratio than Toray Industries, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Sherwin-Williams and Toray Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sherwin-Williams	10.90%	65.26%	11.22%
Toray Industries	1.71%	2.38%	1.29%

Dividends

Sherwin-Williams pays an annual dividend of $3.20 per share and has a dividend yield of 0.9%. Toray Industries pays an annual dividend of $0.15 per share and has a dividend yield of 1.1%. Sherwin-Williams pays out 31.2% of its earnings in the form of a dividend. Toray Industries pays out 38.5% 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. Sherwin-Williams has raised its dividend for 48 consecutive years.

Institutional and Insider Ownership

77.7% of Sherwin-Williams shares are held by institutional investors. 0.2% of Sherwin-Williams shares are held 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.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Sherwin-Williams and Toray Industries, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sherwin-Williams	0	5	9	0	2.64
Toray Industries	0	2	0	1	2.67

Sherwin-Williams currently has a consensus target price of $379.08, indicating a potential upside of 12.20%. Given Sherwin-Williams’ higher possible upside, equities analysts clearly believe Sherwin-Williams is more favorable than Toray Industries.

Volatility & Risk

Sherwin-Williams has a beta of 1.27, indicating that its share price is 27% more volatile than the S&P 500. Comparatively, Toray Industries has a beta of 0.49, indicating that its share price is 51% less volatile than the S&P 500.

Summary

Sherwin-Williams beats Toray Industries on 14 of the 18 factors compared between the two stocks.

About Sherwin-Williams

The Sherwin-Williams Company engages in the development, manufacture, distribution, and sale of paints, coating, and related products to professional, industrial, commercial, and retail customers. It operates through three segments: Paint Stores Group, Consumer Brands Group, and Performance Coatings Group. The Paint Stores Group segment offers architectural paints and coatings, and protective and marine products, as well as OEM product finishes and related products for architectural and industrial paint contractors, and do-it-yourself homeowners. The Consumer Brands Group segment supplies a portfolio of branded and private-label architectural paints, stains, varnishes, industrial products, wood finishes products, wood preservatives, applicators, corrosion inhibitors, aerosols, caulks, and adhesives to retailers, including home centers and hardware stores, and dedicated dealers and distributors. The Performance Coatings Group segment develops and sells industrial coatings for wood finishing and general industrial applications, automotive refinish products, protective and marine coatings, coil coatings, packaging coatings, and performance-based resins and colorants. It serves retailers, dealers, jobbers, licensees, and other third-party distributors through its branches and direct sales staff, as well as through outside sales representatives. The company has operations primarily in the North and South America, the Caribbean, Europe, Asia, and Australia. The Sherwin-Williams Company was founded in 1866 and is headquartered in Cleveland, Ohio.

About Toray Industries

Toray Industries, Inc., together with its subsidiaries, manufactures, processes, and sells fibers and textiles, performance chemicals, carbon fiber composite materials, environment and engineering products, and life science products in Japan, China, North America, Europe, and internationally. The company offers filament yarns, staple fibers, and spun yarns, as well as woven and knitted fabrics of nylon, polyester, acrylics, and others; non-woven fabrics; ultra-fine fibers; and apparel products. It also provides nylon, ABS, PBT, PPS, and other resins and molded products; polyolefin foam products; polyester, polyethylene, polypropylene, and other films; processed film products; raw materials for synthetic fibers and other plastics; fine chemicals; electronic and information materials; and graphic materials. In addition, the company offers carbon fibers, carbon fiber composite materials, and molded products; analysis, physical evaluation, research, and other services; and pharmaceuticals, medical devices, etc. Further, it provides engineering services; condominiums; industrial equipment and machinery; IT-related equipment; water treatment membranes and related equipment; and materials for housing, building, and civil engineering applications. The company was formerly known as Toyo Rayon Co., Ltd. and changed its name to Toray Industries, Inc. in 1970. The company was incorporated in 1926 and is headquartered in Tokyo, Japan.