Analyzing Northern Technologies International (NASDAQ:NTIC) and Nippon Paint (OTCMKTS:NPCPF)

Northern Technologies International (NASDAQ:NTIC) and Nippon Paint (OTCMKTS:NPCPF) are both materials companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, risk, valuation, profitability, analyst recommendations, institutional ownership and dividends.

Institutional & Insider Ownership

32.9% of Northern Technologies International shares are owned by institutional investors. 24.9% of Northern Technologies International shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Northern Technologies International and Nippon Paint, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Northern Technologies International	1	1	0	0	1.50
Nippon Paint	0	1	0	0	2.00

Volatility and Risk

Northern Technologies International has a beta of 0.18, suggesting that its stock price is 82% less volatile than the S&P 500. Comparatively, Nippon Paint has a beta of 0.05, suggesting that its stock price is 95% less volatile than the S&P 500.

Earnings & Valuation

This table compares Northern Technologies International and Nippon Paint”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Northern Technologies International	$84.24 million	0.89	$20,000.00	($0.12)	-65.92
Nippon Paint	$11.87 billion	1.31	$1.20 billion	$0.56	11.95

Nippon Paint has higher revenue and earnings than Northern Technologies International. Northern Technologies International is trading at a lower price-to-earnings ratio than Nippon Paint, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Northern Technologies International and Nippon Paint’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Northern Technologies International	-1.26%	-0.45%	-0.33%
Nippon Paint	10.22%	10.65%	4.85%

Summary

Nippon Paint beats Northern Technologies International on 9 of the 12 factors compared between the two stocks.

About Northern Technologies International

Northern Technologies International Corporation develops and markets rust and corrosion inhibiting solutions in North America, South America, Europe, Asia, the Middle East and internationally. It offers rust and corrosion inhibiting products, such as plastic and paper packaging, liquids, coatings, rust removers, cleaners, diffusers, and engineered solutions designed for the oil and gas industry under the ZERUST brand. The company provides a portfolio of bio-based and certified compostable polymer resin compounds and finished products under the Natur-Tec brand. In addition, it offers on-site and technical consulting for rust and corrosion prevention issues. It sells its products and services to automotive, electronics, electrical, mechanical, military, retail consumer, and oil and gas markets through direct sales force, network of independent distributors, agents, manufacturer's sales representatives, and strategic partners. The company was founded in 1970 and is headquartered in Circle Pines, Minnesota.

About Nippon Paint

Nippon Paint Holdings Co., Ltd. engages in the paints and fine chemicals businesses. The company offers automotive coatings, including paints for the automotive body, including surface treatment, electrodeposition coating, intermediate coating, and finish coating; paints for plastic components, such as bumpers and interior components; trade-use paints for construction sites, including single-family detached homes, buildings, and bridges; and industrial coatings that are used in a range of products, including construction and farming machinery, exterior construction materials, office equipment, and electric home appliances. It also provides marine coatings, such as antifouling paints; treatment agents for steel and aluminum products; and paints for DIY applications comprising wallpaper, wall cloth, and wooden, steel, and concrete materials. In addition, the company offers surface treatment products comprising functional coatings, which demonstrate various functions, such as hydrophilicity and rust prevention, and substrate films; caulking agents to fill gaps between building materials; adhesives to fix flooring and building materials; and fillers used for base coatings. Further, it is involved in the investment business; manufactures and sells surface treatment agents; and sales of paints and raw materials. The company has operations in Japan, Asia, the Americas, Oceania, and internationally. The company was formerly known as Nippon Paint Co., Ltd. and changed its name to Nippon Paint Holdings Co., Ltd. in October 2014. Nippon Paint Holdings Co., Ltd. was founded in 1879 and is headquartered in Tokyo, Japan.