Multi-Color Corporation (NASDAQ: LABL) and ARC Document Solutions (NYSE:ARC) are both small-cap industrial products companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, earnings, institutional ownership, risk, dividends, valuation and profitability.
Volatility and Risk
Multi-Color Corporation has a beta of 0.83, indicating that its stock price is 17% less volatile than the S&P 500. Comparatively, ARC Document Solutions has a beta of 2.5, indicating that its stock price is 150% more volatile than the S&P 500.
This is a summary of recent ratings and target prices for Multi-Color Corporation and ARC Document Solutions, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|ARC Document Solutions||0||0||1||1||3.50|
Multi-Color Corporation presently has a consensus price target of $74.25, indicating a potential downside of 1.98%. ARC Document Solutions has a consensus price target of $5.25, indicating a potential upside of 49.15%. Given ARC Document Solutions’ stronger consensus rating and higher probable upside, analysts clearly believe ARC Document Solutions is more favorable than Multi-Color Corporation.
Multi-Color Corporation pays an annual dividend of $0.20 per share and has a dividend yield of 0.3%. ARC Document Solutions does not pay a dividend. Multi-Color Corporation pays out 5.8% of its earnings in the form of a dividend.
Earnings and Valuation
This table compares Multi-Color Corporation and ARC Document Solutions’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Multi-Color Corporation||$929.24 million||1.39||$158.28 million||$3.47||21.83|
|ARC Document Solutions||$400.01 million||0.41||$56.98 million||$0.24||14.67|
Multi-Color Corporation has higher revenue and earnings than ARC Document Solutions. ARC Document Solutions is trading at a lower price-to-earnings ratio than Multi-Color Corporation, indicating that it is currently the more affordable of the two stocks.
This table compares Multi-Color Corporation and ARC Document Solutions’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|ARC Document Solutions||2.72%||7.00%||2.91%|
Institutional and Insider Ownership
77.0% of Multi-Color Corporation shares are held by institutional investors. Comparatively, 71.9% of ARC Document Solutions shares are held by institutional investors. 19.4% of Multi-Color Corporation shares are held by company insiders. Comparatively, 14.9% of ARC Document Solutions 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.
Multi-Color Corporation beats ARC Document Solutions on 11 of the 17 factors compared between the two stocks.
About Multi-Color Corporation
Multi-Color Corporation (Multi-Color) is engaged in label solutions business, supporting brands, including producers of home and personal care, wine and spirit, food and beverage, healthcare and specialty consumer products. The Company serves international brand owners in North, Central and South America, Europe, Australia, New Zealand, South Africa and China and Southeast Asia with a range of label technologies in Pressure Sensitive, Glue-Applied (Cut and Stack), In-Mold, Shrink Sleeve and Heat Transfer. The Company also provides a range of print methods, including flexographic, lithographic, rotogravure, letterpress and digital, and in-house prepress services. The Company provides graphics and pre-press services for its customers at all of its manufacturing locations. These services include the conversion of customer digital files and artwork into proofs, production of print layouts and printing plates, and product mock ups and samples for market research.
About ARC Document Solutions
ARC Document Solutions, Inc. (ARC) is a document solutions provider for the architectural, engineering and construction (AEC) industry. The Company also provides document solutions to businesses of various types. ARC’s offerings include managed print services (MPS), offsite services, archive and information management (AIM), specialized color printing, Web-based document management applications, digital shipping/managed file transfer, and equipment and supplies sales. MPS is an onsite service where it installs a complete document solution platform in its customers’ offices and project sites. Its Offsite Services offering operates over 180 offsite service centers. AIM enables its customers to store information and intellectual property in a cloud-based and searchable digital archive. The Specialized Color Printing offering is focused on color printing, finishing and assembly of graphic materials. Its Web-Based Document Management Applications develop and offer tools to its customers.
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