Sylvamo (NYSE:SLVM – Get Free Report) and Clearwater Paper (NYSE:CLW – Get Free Report) are both small-cap materials companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, earnings, valuation, risk, institutional ownership, dividends and analyst recommendations.
Insider and Institutional Ownership
91.2% of Sylvamo shares are held by institutional investors. Comparatively, 90.0% of Clearwater Paper shares are held by institutional investors. 0.8% of Sylvamo shares are held by insiders. Comparatively, 2.4% of Clearwater Paper shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Volatility and Risk
Sylvamo has a beta of 0.87, meaning that its stock price is 13% less volatile than the S&P 500. Comparatively, Clearwater Paper has a beta of 0.34, meaning that its stock price is 66% less volatile than the S&P 500.
Profitability
This table compares Sylvamo and Clearwater Paper’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Sylvamo | 2.31% | 8.36% | 2.90% |
| Clearwater Paper | 0.16% | -7.36% | -3.65% |
Valuation & Earnings
This table compares Sylvamo and Clearwater Paper”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sylvamo | $3.35 billion | 0.38 | $132.00 million | $1.88 | 17.17 |
| Clearwater Paper | $1.56 billion | 0.14 | -$18.60 million | $0.16 | 83.12 |
Sylvamo has higher revenue and earnings than Clearwater Paper. Sylvamo is trading at a lower price-to-earnings ratio than Clearwater Paper, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of recent ratings for Sylvamo and Clearwater Paper, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sylvamo | 1 | 3 | 2 | 0 | 2.17 |
| Clearwater Paper | 1 | 6 | 1 | 0 | 2.00 |
Sylvamo presently has a consensus target price of $41.00, suggesting a potential upside of 27.01%. Clearwater Paper has a consensus target price of $19.67, suggesting a potential upside of 47.87%. Given Clearwater Paper’s higher probable upside, analysts clearly believe Clearwater Paper is more favorable than Sylvamo.
Summary
Sylvamo beats Clearwater Paper on 11 of the 14 factors compared between the two stocks.
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.
About Clearwater Paper
Clearwater Paper Corporation manufactures and supplies bleached paperboards, and consumer and parent roll tissues in the United States and internationally. It operates through Pulp and Paperboard, and Consumer Products segments. The Pulp and Paperboard segment manufactures and markets bleached paperboard; Solid Bleached Sulfate paperboard that is used to produce folding cartons, liquid packaging, cups and plates, blister and carded packaging, and top sheet and commercial printing items; and hardwood and softwood pulp, as well as offers services that include custom sheeting, slitting, and cutting. It sells its products to carton converters, folding carton converters, merchants, and commercial printers. The Consumer Products segment provides a line of at-home tissue products, including bath tissues, paper towels, facial tissues, and napkins; recycled fiber value grade products; and away-from-home tissues. This segment sells its products to retailers, including grocery, club, mass merchants, and discount stores. The company was incorporated in 2005 and is based in Spokane, Washington.
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