Analyzing Magnera (NYSE:MAGN) & Clearwater Paper (NYSE:CLW)

Magnera (NYSE:MAGN) and Clearwater Paper (NYSE:CLW) are both small-cap materials companies, but which is the better business? We will compare the two companies based on the strength of their valuation, risk, earnings, dividends, institutional ownership, profitability and analyst recommendations.

Profitability

This table compares Magnera and Clearwater Paper’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Magnera	-3.41%	-10.77%	-2.87%
Clearwater Paper	-3.24%	-7.95%	-4.06%

Insider & Institutional Ownership

76.9% of Magnera shares are owned by institutional investors. Comparatively, 90.0% of Clearwater Paper shares are owned by institutional investors. 1.0% of Magnera shares are owned by insiders. Comparatively, 2.4% of Clearwater Paper shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and price targets for Magnera and Clearwater Paper, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Magnera	1	2	0	0	1.67
Clearwater Paper	1	6	1	0	2.00

Magnera presently has a consensus price target of $16.00, indicating a potential upside of 43.46%. Clearwater Paper has a consensus price target of $19.83, indicating a potential upside of 5.98%. Given Magnera’s higher probable upside, analysts clearly believe Magnera is more favorable than Clearwater Paper.

Earnings and Valuation

This table compares Magnera 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
Magnera	$3.20 billion	0.12	-$159.00 million	($2.01)	-5.55
Clearwater Paper	$1.52 billion	0.20	-$18.60 million	($3.04)	-6.16

Clearwater Paper has lower revenue, but higher earnings than Magnera. Clearwater Paper is trading at a lower price-to-earnings ratio than Magnera, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Magnera has a beta of 1.75, indicating that its share price is 75% more volatile than the S&P 500. Comparatively, Clearwater Paper has a beta of 0.33, indicating that its share price is 67% less volatile than the S&P 500.

Summary

Clearwater Paper beats Magnera on 8 of the 14 factors compared between the two stocks.

About Magnera

Magnera’s purpose is to better the world with new possibilities made real. By continuously co-creating and innovating with our partners, we develop original material solutions that make a brighter future possible. With a breadth of technologies and a passion for what we create, Magnera’s solutions propel our customers’ goals forward and solve end-users’ problems, every day.

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.