Sylvamo (NYSE:SLVM – Get Free Report) and Rayonier Advanced Materials (NYSE:RYAM – Get Free Report) are both small-cap basic materials companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, valuation, dividends, institutional ownership, profitability, earnings and risk.
Volatility and Risk
Sylvamo has a beta of 0.95, suggesting that its share price is 5% less volatile than the S&P 500. Comparatively, Rayonier Advanced Materials has a beta of 2.17, suggesting that its share price is 117% more volatile than the S&P 500.
Profitability
This table compares Sylvamo and Rayonier Advanced Materials’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Sylvamo | 5.25% | 19.72% | 6.87% |
| Rayonier Advanced Materials | -28.21% | -13.64% | -3.64% |
Valuation and Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sylvamo | $3.77 billion | 0.50 | $302.00 million | $4.37 | 10.93 |
| Rayonier Advanced Materials | $1.63 billion | 0.26 | -$38.71 million | ($6.25) | -1.01 |
Sylvamo has higher revenue and earnings than Rayonier Advanced Materials. Rayonier Advanced Materials is trading at a lower price-to-earnings ratio than Sylvamo, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent ratings and price targets for Sylvamo and Rayonier Advanced Materials, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sylvamo | 1 | 2 | 1 | 0 | 2.00 |
| Rayonier Advanced Materials | 1 | 1 | 1 | 0 | 2.00 |
Sylvamo presently has a consensus price target of $54.00, suggesting a potential upside of 13.02%. Rayonier Advanced Materials has a consensus price target of $6.00, suggesting a potential downside of 5.29%. Given Sylvamo’s higher probable upside, equities research analysts plainly believe Sylvamo is more favorable than Rayonier Advanced Materials.
Institutional and Insider Ownership
91.2% of Sylvamo shares are owned by institutional investors. Comparatively, 68.6% of Rayonier Advanced Materials shares are owned by institutional investors. 0.7% of Sylvamo shares are owned by insiders. Comparatively, 4.4% of Rayonier Advanced Materials shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Summary
Sylvamo beats Rayonier Advanced Materials on 10 of the 12 factors compared between the two stocks.
About Sylvamo
Sylvamo Corporation produces and markets uncoated freesheet for cutsize, offset paper, and pulp in Latin America, Europe, and North America. The company operates through Europe, Latin America, and North America segments. The Europe segment offers copy, tinted, and colored laser printing paper under REY Adagio and Pro-Design brands; and graphic and high-speed inkjet printing papers under the brand Jetstar; as well as produces uncoated freesheet papers. The Latin America segment focuses on uncoated freesheet paper under Chamex, Chamequinho and Chambril brands, as well as produces HP papers. This segment also operates integrated mills and non-integrated mills. The North America segment offers imaging, commercial printing, and converting papers, as well as uncoated papers under Hammermill, Springhill, Williamsburg, Accent, DRM and Postmark brand names. It distributes its products through a variety of channels, including retail merchants, e-commerce, agents, resellers, and paper distributors. The company was founded in 1898 and is headquartered in Memphis, Tennessee.
About Rayonier Advanced Materials
Rayonier Advanced Materials Inc. manufactures and sells cellulose specialty products in the United States, China, Latin America, Canada, Japan, Europe, Latin America, other Asian countries, and internationally. It operates through High Purity Cellulose, Paperboard, and High-Yield Pulp segments. The company’s products include cellulose specialties, which are natural polymers that are used as raw materials to manufacture a range of consumer-oriented products, such as liquid crystal displays, impact-resistant plastics, thickeners for food products, pharmaceuticals, cosmetics, cigarette filters, high-tenacity rayon yarn for tires and industrial hoses, food casings, paints, and lacquers. It also offers commodity products, such as commodity viscose pulp used in woven applications, including rayon textiles for clothing and other fabrics, as well as in non-woven applications comprising baby wipes, cosmetic and personal wipes, industrial wipes, and mattress ticking; and absorbent materials consisting of fluff fibers that are used as an absorbent medium in disposable baby diapers, feminine hygiene products, incontinence pads, convalescent bed pads, industrial towels and wipes, and non-woven fabrics. In addition, the company provides paperboards for packaging, printing documents, brochures, promotional materials, paperback books and catalog covers, file folders, tags, and lottery tickets; and high-yield pulps to produces hardwood aspen, maple, and birch species for paperboard, packaging, printing and writing papers, and various other paper products. The company was founded in 1926 and is headquartered in Jacksonville, Florida.
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