Westrock (NYSE: WRK) and KapStone Paper and Packaging Corp. (NYSE:KS) are both mid-cap basic materials companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, earnings, profitabiliy, analyst recommendations, risk, institutional ownership and dividends.
Insider & Institutional Ownership
88.9% of Westrock shares are owned by institutional investors. Comparatively, 82.9% of KapStone Paper and Packaging Corp. shares are owned by institutional investors. 2.7% of Westrock shares are owned by company insiders. Comparatively, 13.3% of KapStone Paper and Packaging Corp. shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Volatility & Risk
Westrock has a beta of 1.37, meaning that its stock price is 37% more volatile than the S&P 500. Comparatively, KapStone Paper and Packaging Corp. has a beta of 2.83, meaning that its stock price is 183% more volatile than the S&P 500.
This is a breakdown of current ratings for Westrock and KapStone Paper and Packaging Corp., as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|KapStone Paper and Packaging Corp.||0||6||5||0||2.45|
Westrock currently has a consensus price target of $61.67, suggesting a potential upside of 4.68%. KapStone Paper and Packaging Corp. has a consensus price target of $26.60, suggesting a potential upside of 17.65%. Given KapStone Paper and Packaging Corp.’s higher probable upside, analysts plainly believe KapStone Paper and Packaging Corp. is more favorable than Westrock.
Westrock pays an annual dividend of $1.60 per share and has a dividend yield of 2.7%. KapStone Paper and Packaging Corp. pays an annual dividend of $0.40 per share and has a dividend yield of 1.8%. Westrock pays out 225.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. KapStone Paper and Packaging Corp. pays out 51.3% of its earnings in the form of a dividend.
This table compares Westrock and KapStone Paper and Packaging Corp.’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|KapStone Paper and Packaging Corp.||0.78%||2.65%||0.73%|
Valuation and Earnings
This table compares Westrock and KapStone Paper and Packaging Corp.’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Westrock||$14.31 billion||1.02||$2.15 billion||$0.71||82.97|
|KapStone Paper and Packaging Corp.||$3.10 billion||0.71||$349.68 million||$0.78||28.99|
Westrock has higher revenue and earnings than KapStone Paper and Packaging Corp.. KapStone Paper and Packaging Corp. is trading at a lower price-to-earnings ratio than Westrock, indicating that it is currently the more affordable of the two stocks.
Westrock beats KapStone Paper and Packaging Corp. on 12 of the 17 factors compared between the two stocks.
Westrock Company Profile
WestRock Company, incorporated on March 6, 2015, is a multinational provider of paper and packaging solutions for consumer and corrugated packaging markets. The Company also develops real estate in the Charleston, South Carolina region. The Company’s segments include Corrugated Packaging, Consumer Packaging, and Land and Development. The Corrugated Packaging segment consists of its containerboard mill and corrugated packaging operations, as well as its recycling operations. The Consumer Packaging segment consists of consumer mills, folding carton, beverage, merchandising displays, and partition operations. The Land and Development segment is engaged in the development and sale of real estate primarily in Charleston, South Carolina.
KapStone Paper and Packaging Corp. Company Profile
KapStone Paper and Packaging Corporation is a producer of containerboard and the kraft paper in North America. The Company operates through two segments: Paper and Packaging, and Distribution. The Paper and Packaging segment manufactures and sells a range of containerboard, corrugated products and specialty paper for industrial and consumer markets. The Distribution segment, which operates under the Victory and Golden State Container trade names, provides its customers packaging solutions and services and distributes corrugated packaging materials and other specialty packaging products, which include stretch film, void fill, carton sealing tape and other specialty tapes. The Company produces a range of products ranging from basic corrugated shipping containers to specialized packaging. The Company also produces packaging for fresh fruit and vegetables, processed food, beverages, and other industrial and consumer products.