Huntsman (NYSE:HUN) versus Akzo Nobel (OTCMKTS:AKZOY) Critical Comparison

Akzo Nobel (OTCMKTS:AKZOY) and Huntsman (NYSE:HUN) are both mid-cap basic materials companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, institutional ownership, profitability, valuation, analyst recommendations, risk and earnings.

Dividends

Akzo Nobel pays an annual dividend of $0.25 per share and has a dividend yield of 1.3%. Huntsman pays an annual dividend of $0.35 per share and has a dividend yield of 2.9%. Akzo Nobel pays out 17.7% of its earnings in the form of a dividend. Huntsman pays out -21.3% 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. Huntsman has increased its dividend for 4 consecutive years. Huntsman is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Akzo Nobel and Huntsman’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Akzo Nobel	6.49%	13.73%	4.39%
Huntsman	-5.00%	-3.97%	-1.70%

Earnings & Valuation

This table compares Akzo Nobel and Huntsman”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Akzo Nobel	$11.49 billion	0.86	$718.44 million	$1.41	13.70
Huntsman	$5.68 billion	0.37	-$284.00 million	($1.64)	-7.30

Akzo Nobel has higher revenue and earnings than Huntsman. Huntsman is trading at a lower price-to-earnings ratio than Akzo Nobel, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Akzo Nobel has a beta of 1.07, indicating that its share price is 7% more volatile than the S&P 500. Comparatively, Huntsman has a beta of 0.66, indicating that its share price is 34% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Akzo Nobel and Huntsman, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Akzo Nobel	1	2	0	1	2.25
Huntsman	4	8	1	1	1.93

Huntsman has a consensus price target of $12.41, indicating a potential upside of 3.62%. Given Huntsman’s higher probable upside, analysts plainly believe Huntsman is more favorable than Akzo Nobel.

Institutional and Insider Ownership

0.4% of Akzo Nobel shares are owned by institutional investors. Comparatively, 84.8% of Huntsman shares are owned by institutional investors. 6.2% of Huntsman shares are owned 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.

Summary

Akzo Nobel beats Huntsman on 10 of the 17 factors compared between the two stocks.

About Akzo Nobel

Akzo Nobel N.V. engages in the production and sale of paints and coatings worldwide. The company operates through two segments: Decorative Paints and Performance Coatings. It offers decorative paints, including paints, lacquers, and varnishes; and a range of mixing machines and color concepts for the building and renovation industry, as well as specialty coatings. The company also provides performance coatings that protect and enhance ships, cars, aircraft, yachts, architectural components, consumer goods, and oil and gas facilities. It offers its products under AkzoNobel, Alabastine, Alba, Andercol, Apla, Armstead Trade, Astral, Astral Batiment, AwlGrip, Brikol, Dulux, Bruguer, Cetabever, Cetol, Chemcraft, Colourland Paints, CONSOLAN, Coral, Cromadex, Cuprinol, Dynacoat, Flexa, Glitsa, Grip-Gard, Herbol, Hammerite, International, Interlux, Innenweis, Interpon, Inca, Luxol, Levis, Lesonal, Molto, Modern Classikk, Maxilite, Mauvilac, Mason CT, Marshall, Mactra, Nordsjo, Oxirite, Protecto, Procolor, Polyfilla, Polycell, Pinotex, Pintuco, Resicoat, Relest, Sparlack, Sadolin, Sikkens, Sea Hawk, Savana, Salcomix, Trimetal, Titanlux, Taubmans, U-tech, Vpowdertech, Vivechrom, Xylazel, Xyladecor, Wanda, and Zweihorn brands. The company serves to energy, packaging, infrastructure, and shipbuilding and maintenance industries, as well as general industries, such as agricultural and construction equipment, construction-related steel, metal fabrication, pipes, appliances, and transportation. The company was formerly known as Akzo NV and changed its name to Akzo Nobel N.V. in 1994. Akzo Nobel N.V. was founded in 1646 and is headquartered in Amsterdam, the Netherlands.

About Huntsman

Huntsman Corporation manufactures and sells diversified organic chemical products worldwide. The company operates in three segments: Polyurethanes, Performance Products, and Advanced Materials. The Polyurethanes segment offers polyurethane chemicals, including methyl diphenyl diisocyanate, polyether and polyester polyols, and thermoplastic polyurethane; and aniline, benzene, nitrobenzene and other co-products. The Performance Products segment manufactures amines, such as polyetheramines, ethyleneamines, DGA Agent, JEFFCAT catalysts, and E-GRADE specialty amines and carbonates; and maleic anhydrides. The Advanced Materials segment offers epoxy, phenoxy, acrylic, polyurethane, and acrylonitrile-butadiene-based polymer formulations; and thermoset resins, curing and toughening agents, and carbon nanomaterials. The company provides pre-and post-sales technical service support to customers. Its products are used in a range of applications, including adhesives, aerospace, automotive, construction products, durable and non-durable consumer products, electronics, insulation, packaging, coatings and construction, power generation, and refining, as well as serves the elastomers, insulation, footwear, furniture, industrial, oil and gas, liquid natural gas transport, printed circuit boards, consumer, appliances, electrical power transmission and distribution, recreational sports equipment, and medical appliances markets. The company sells its products through a network of distributors and agents. Huntsman Corporation was founded in 1970 and is headquartered in The Woodlands, Texas.