Amcor (NYSE:AMCR) vs. International Paper (NYSE:IP) Financial Survey

International Paper (NYSE:IP) and Amcor (NYSE:AMCR) are both large-cap materials companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, institutional ownership, profitability, analyst recommendations, risk, dividends and valuation.

Risk and Volatility

International Paper has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500. Comparatively, Amcor has a beta of 0.58, meaning that its share price is 42% less volatile than the S&P 500.

Dividends

International Paper pays an annual dividend of $1.85 per share and has a dividend yield of 5.8%. Amcor pays an annual dividend of $2.60 per share and has a dividend yield of 6.2%. International Paper pays out -28.4% of its earnings in the form of a dividend. Amcor pays out 110.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Amcor has raised its dividend for 5 consecutive years. Amcor is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings and Valuation

This table compares International Paper and Amcor”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
International Paper	$23.63 billion	0.72	-$3.52 billion	($6.52)	-4.92
Amcor	$23.51 billion	0.82	$177.00 million	$2.36	17.68

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

Insider and Institutional Ownership

82.0% of International Paper shares are owned by institutional investors. Comparatively, 45.1% of Amcor shares are owned by institutional investors. 0.2% of International Paper shares are owned by company insiders. Comparatively, 0.3% of Amcor shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares International Paper and Amcor’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
International Paper	-14.20%	-1.09%	-0.44%
Amcor	4.71%	15.92%	5.01%

Analyst Recommendations

This is a summary of current ratings for International Paper and Amcor, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
International Paper	1	3	10	0	2.64
Amcor	0	6	5	1	2.58

International Paper presently has a consensus target price of $47.52, suggesting a potential upside of 48.00%. Amcor has a consensus target price of $49.36, suggesting a potential upside of 18.29%. Given International Paper’s stronger consensus rating and higher probable upside, equities research analysts plainly believe International Paper is more favorable than Amcor.

Summary

Amcor beats International Paper on 11 of the 18 factors compared between the two stocks.

About International Paper

International Paper Company produces and sells renewable fiber-based packaging and pulp products in North America, Latin America, Europe, and North Africa. It operates through two segments, Industrial Packaging and Global Cellulose Fibers. The company offers linerboard, medium, whitetop, recycled linerboard, recycled medium and saturating kraft; and pulp for a range of applications, such as diapers, towel and tissue products, feminine care, incontinence, and other personal care products, as well as specialty pulps for use in textiles, construction materials, paints, coatings, and others. It sells its products directly to end users and converters, as well as through agents, resellers, and distributors. The company was founded in 1898 and is headquartered in Memphis, Tennessee.

About Amcor

Amcor plc develops, produces, and sells packaging products in Europe, North America, Latin America, Africa, and the Asia Pacific regions. The company operates through two segments, Flexibles and Rigid Packaging. The Flexibles segment provides flexible and film packaging products in the food and beverage, medical and pharmaceutical, fresh produce, snack food, personal care, and other industries. The Rigid Packaging segment offers rigid containers for various beverage and food products, including carbonated soft drinks, water, juices, sports drinks, milk-based beverages, spirits and beer, sauces, dressings, spreads, and personal care items; and plastic caps for various applications. The company sells its products through its direct sales force. Amcor plc was incorporated in 2018 and is headquartered in Zurich, Switzerland.