Rayonier Advanced Materials (NYSE:RYAM) versus Givaudan (OTCMKTS:GVDBF) Critical Review

Givaudan (OTCMKTS:GVDBF) and Rayonier Advanced Materials (NYSE:RYAM) are both materials companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, earnings, institutional ownership, analyst recommendations, profitability, dividends and risk.

Profitability

This table compares Givaudan and Rayonier Advanced Materials’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Givaudan	N/A	N/A	N/A
Rayonier Advanced Materials	-9.53%	-42.27%	-7.16%

Institutional and Insider Ownership

28.7% of Givaudan shares are held by institutional investors. Comparatively, 68.6% of Rayonier Advanced Materials shares are held by institutional investors. 3.2% of Rayonier Advanced Materials shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Givaudan and Rayonier Advanced Materials”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Givaudan	N/A	N/A	N/A	$56.28	69.18
Rayonier Advanced Materials	$1.47 billion	0.44	-$420.67 million	($7.05)	-1.35

Givaudan has higher earnings, but lower revenue than Rayonier Advanced Materials. Rayonier Advanced Materials is trading at a lower price-to-earnings ratio than Givaudan, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current recommendations and price targets for Givaudan and Rayonier Advanced Materials, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Givaudan	0	0	0	0	0.00
Rayonier Advanced Materials	2	0	1	0	1.67

Rayonier Advanced Materials has a consensus target price of $13.00, suggesting a potential upside of 36.40%. Given Rayonier Advanced Materials’ stronger consensus rating and higher possible upside, analysts clearly believe Rayonier Advanced Materials is more favorable than Givaudan.

Summary

Rayonier Advanced Materials beats Givaudan on 6 of the 11 factors compared between the two stocks.

About Givaudan

Givaudan SA manufactures, supplies, and sells fragrance, beauty, taste, and wellbeing products to the consumer goods industry. The company operates through divisions, Fragrance & Beauty, and Taste & Wellbeing. The Fragrance & Beauty division offers fine fragrances; consumer products, such as personal, home, fabric, and oral care; fragrance ingredients; and active beauty products. The Taste & Wellbeing division provides beverages, such as fizzy drinks, bottled waters, ready-to-drink juices, alcoholic beverages, and others; dairy and cheese products, including dairy drinks, yoghurt, ice cream, chilled desserts, cream cheese, and spreads; snacks; givaudan flavour ingredients; savory, and supplements and nutraceutical products; and biscuits, crackers, and cereals, as well as confectionery products, such as chewing gums, chocolates, and sweets. It operates in Switzerland, Europe, Africa, the Middle East, North America, Latin America, and the Asia Pacific. Givaudan SA was founded in 1796 and is headquartered in Vernier, Switzerland.

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.