Neste OYJ (OTCMKTS:NTOIY) versus Idemitsu Kosan Co.,Ltd. (OTCMKTS:IDKOY) Critical Analysis

Idemitsu Kosan Co.,Ltd. (OTCMKTS:IDKOY) and Neste OYJ (OTCMKTS:NTOIY) are both energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, institutional ownership, dividends, risk, analyst recommendations, earnings and valuation.

Analyst Recommendations

This is a summary of current ratings and price targets for Idemitsu Kosan Co.,Ltd. and Neste OYJ, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Idemitsu Kosan Co.,Ltd.	0	0	0	0	0.00
Neste OYJ	0	4	1	2	2.71

Valuation & Earnings

This table compares Idemitsu Kosan Co.,Ltd. and Neste OYJ”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Idemitsu Kosan Co.,Ltd.	N/A	N/A	N/A	$50.83	0.38
Neste OYJ	$21.51 billion	1.21	$162.92 million	$0.09	188.78

Neste OYJ has higher revenue and earnings than Idemitsu Kosan Co.,Ltd.. Idemitsu Kosan Co.,Ltd. is trading at a lower price-to-earnings ratio than Neste OYJ, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Idemitsu Kosan Co.,Ltd. and Neste OYJ’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Idemitsu Kosan Co.,Ltd.	N/A	N/A	N/A
Neste OYJ	0.81%	2.13%	0.99%

Dividends

Idemitsu Kosan Co.,Ltd. pays an annual dividend of $11.25 per share and has a dividend yield of 58.6%. Neste OYJ pays an annual dividend of $0.03 per share and has a dividend yield of 0.2%. Idemitsu Kosan Co.,Ltd. pays out 22.1% of its earnings in the form of a dividend. Neste OYJ pays out 33.3% 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. Idemitsu Kosan Co.,Ltd. is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Neste OYJ beats Idemitsu Kosan Co.,Ltd. on 8 of the 11 factors compared between the two stocks.

About Idemitsu Kosan Co.,Ltd.

Idemitsu Kosan Co.,Ltd. engages in the petroleum, basic chemicals, functional materials, power and renewable energy, and resources businesses in Japan and internationally. The company’s Petroleum segment engages in the procurement of crude oil and refining of petroleum products; sale of gasoline, diesel oil, kerosene, automotive lubricants, industrial kerosene, heavy oil, and aviation and marine fuel; and operation of hydrogen stations. Its Basic Chemicals segment manufactures and sells olefins, such as ethylene, propylene, and butadiene; aromatics, including benzene, styrene monomer, mixed xylene, and paraxylene; and other chemicals. The company’s Functional Materials segment researches, develops, manufactures, and sells automotive, industrial, and marine lubricants, as well as grease; engineering plastic, adhesive materials, derivative products, and solvents; electronic materials, such as OLED; asphalt; microbial pesticides, soil amendments, and livestock related materials; and solid state lithium ion battery materials. Its Power and Renewable Energy segment operates thermal power plants; develops and operates renewable energy sources, including solar, wind, and biomass power plants; engages in the supply, wholesale, and retail of electric power; researches, develops, and manufactures CIS thin-film solar modules; and sells solar power systems. The company’s Resources segments explores, develops, and produces oil and gas; produces and sells coal and uranium; operates geothermal power plants; and sale of electric power and steam. Idemitsu Kosan Co.,Ltd. was founded in 1911 and is headquartered in Tokyo, Japan.

About Neste OYJ

Neste Oyj provides renewable diesel and sustainable aviation fuel in Finland, and other Nordic countries, Baltic Rim, other European countries, North and South America, and internationally. The company operates in four segments: Renewable Products, Oil Products, Marketing & Services, and Others. The Renewable Products segment produces, markets, and sells renewable diesel, sustainable aviation fuel, renewable solvents, and feedstock for bioplastics to wholesale markets. The Oil Products segment produces, markets, and sells diesel, gasoline, aviation and marine fuels, light and heavy fuel oils, and gasoline components, as well as special fuels, such as small-engine gasoline, solvents, liquid gases, and bitumen. This segment serves retailers and distributors, oil majors and trading companies, petrochemicals companies, and companies marketing lubricants and solvents, as well as road transportation, non-road uses, aviation and marine sectors. The Marketing & Services segment markets and sells cleaner fuels and oil products, and associated services to private motorists, transport companies, customers in aviation, shipping, industrial and agricultural sectors, municipalities, farmers, and heating oil customers through a network of service stations, as well as direct sales and distributors. The Others segment offers engineering solutions. The company was formerly known as Neste Oil Oyj and changed its name to Neste Oyj in June 2015. Neste Oyj was founded in 1948 and is headquartered in Espoo, Finland.