Head-To-Head Review: Louisiana-Pacific (NYSE:LPX) & Supremex (OTCMKTS:SUMXF)

Supremex (OTCMKTS:SUMXF) and Louisiana-Pacific (NYSE:LPX) are both materials companies, but which is the better stock? We will compare the two companies based on the strength of their risk, dividends, institutional ownership, earnings, analyst recommendations, profitability and valuation.

Institutional and Insider Ownership

72.6% of Supremex shares are owned by institutional investors. Comparatively, 94.7% of Louisiana-Pacific shares are owned by institutional investors. 0.7% of Louisiana-Pacific shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings for Supremex and Louisiana-Pacific, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Supremex	0	0	0	0	0.00
Louisiana-Pacific	2	1	11	0	2.64

Louisiana-Pacific has a consensus price target of $94.00, indicating a potential upside of 27.39%. Given Louisiana-Pacific’s stronger consensus rating and higher probable upside, analysts plainly believe Louisiana-Pacific is more favorable than Supremex.

Dividends

Supremex pays an annual dividend of $0.20 per share and has a dividend yield of 7.7%. Louisiana-Pacific pays an annual dividend of $1.20 per share and has a dividend yield of 1.6%. Supremex pays out 53.7% of its earnings in the form of a dividend. Louisiana-Pacific pays out 151.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Louisiana-Pacific has increased its dividend for 7 consecutive years. Supremex is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings and Valuation

This table compares Supremex and Louisiana-Pacific”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Supremex	N/A	N/A	N/A	$0.38	7.00
Louisiana-Pacific	$2.71 billion	1.91	$146.00 million	$0.79	93.40

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

Profitability

This table compares Supremex and Louisiana-Pacific’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Supremex	N/A	N/A	N/A
Louisiana-Pacific	2.19%	4.67%	3.10%

Summary

Louisiana-Pacific beats Supremex on 12 of the 14 factors compared between the two stocks.

About Supremex

Supremex Inc. engages in the manufacture and markets envelopes, and paper-based packaging solutions and specialty products to corporations, resellers, government entities, small and medium sized enterprises, direct mailers, and solutions providers primarily in Canada and the United States. The company offers a range of stock and custom envelopes in various styles, shapes, and colors; and e-Commerce fulfillment packaging solutions; labels; polyethylene bags for courier applications; and bubble mailers. It also provides commercial printing services, including printing, packaging and displays, finishing, and large format services. The company serves various industries, including pharmaceutical, wine and spirits, personal care and beauty, packaging, ecommerce, nutraceutical, food and beverage, apparel, fulfillment, presentation, and display and promotional print and packaging industries. Supremex Inc. was founded in 1977 and is based in Lasalle, Canada.

About Louisiana-Pacific

Louisiana-Pacific Corporation, together with its subsidiaries, provides building solutions primarily for use in new home construction, repair and remodeling, and outdoor structure markets. It operates through Siding, Oriented Strand Board, LP South America, and Other segments. The Siding segment offers LP SmartSide trim and siding products, LP SmartSide ExpertFinish trim and siding products, LP BuilderSeries lap siding products, and LP Outdoor Building Solutions; and engineered wood siding, trim, soffit, and fascia products. Its Oriented Strand Board segment manufactures and distributes oriented strand board structural panel products comprising LP TechShield radiant barriers, LP WeatherLogic air and water barriers, LP Legacy premium sub-flooring products, LP NovaCore, LP FlameBlock fire-rated sheathing products, and LP TopNotch sub-flooring products. The LP South America segment manufactures and distributes oriented strand board structural panel and siding products. This segment distributes and sells related products for the region's transition to wood frame construction. It offers timber and timberlands and other products and services. sells its products primarily to retailers, wholesalers, and homebuilding and industrial businesses in North America and South America, Asia, Australia, and Europe. The company was incorporated in 1972 and is headquartered in Nashville, Tennessee.