Rayonier (NYSE: RYN) and RPM International (NYSE:RPM) are both mid-cap construction companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, dividends, profitability, earnings, analyst recommendations, valuation and institutional ownership.

Earnings & Valuation

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This table compares Rayonier and RPM International’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Rayonier $819.60 million 5.61 $148.84 million $1.16 30.68
RPM International $4.96 billion 1.32 $181.82 million $2.59 18.90

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

Insider & Institutional Ownership

84.2% of Rayonier shares are owned by institutional investors. Comparatively, 75.9% of RPM International shares are owned by institutional investors. 0.6% of Rayonier shares are owned by insiders. Comparatively, 2.1% of RPM International shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Rayonier and RPM International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Rayonier 18.64% 4.96% 2.84%
RPM International 6.80% 25.05% 7.36%

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Rayonier and RPM International, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Rayonier 0 3 1 0 2.25
RPM International 1 4 2 0 2.14

Rayonier presently has a consensus price target of $32.67, suggesting a potential downside of 8.21%. RPM International has a consensus price target of $54.00, suggesting a potential upside of 10.32%. Given RPM International’s higher possible upside, analysts plainly believe RPM International is more favorable than Rayonier.

Volatility & Risk

Rayonier has a beta of 0.35, meaning that its share price is 65% less volatile than the S&P 500. Comparatively, RPM International has a beta of 1.45, meaning that its share price is 45% more volatile than the S&P 500.

Dividends

Rayonier pays an annual dividend of $1.00 per share and has a dividend yield of 2.8%. RPM International pays an annual dividend of $1.28 per share and has a dividend yield of 2.6%. Rayonier pays out 86.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. RPM International pays out 49.4% of its earnings in the form of a dividend. Rayonier has raised its dividend for 43 consecutive years. Rayonier is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

RPM International beats Rayonier on 10 of the 17 factors compared between the two stocks.

About Rayonier

Rayonier Inc. is a timberland real estate investment trust with assets located in some of the timber growing regions in the United States and New Zealand. The Company operates through five segments: Southern Timber, Pacific Northwest Timber, New Zealand Timber, Real Estate and Trading. The Southern Timber, Pacific Northwest Timber and New Zealand Timber segments reflect all activities related to the harvesting of timber and other activities, such as recreational leases, within each respective geography. Its New Zealand Timber segment also reflects land sales that occur within its New Zealand portfolio. Its Real Estate segment reflects the United States land sales. Its Trading segment reflects the log trading activities that support its New Zealand operations. It owned, leased or managed approximately 2.7 million acres of timberlands, as of December 31, 2016. It is engaged in the trading of logs from New Zealand and Australia to Pacific Rim markets.

About RPM International

RPM International Inc. manufactures, markets, and sells specialty chemical products for industrial, specialty, and consumer markets worldwide. Its Industrial segment offers waterproofing, coatings, and institutional roofing systems; sealants, air barriers, tapes, and foams; residential home weatherization systems; roofing and building maintenance and related services; sealing and bonding solutions; flooring and in-plant glazing solutions; passive fire protection and manufacturing industry solutions; polymer flooring systems; and fiberglass reinforced plastic gratings and shapes. This segment also offers corrosion-control coatings, containment linings, fire and sound proofing products, and insulation products; rolled asphalt roofing materials, chemical admixtures, and industrial epoxy flooring systems; concrete and masonry admixtures, concrete fibers, curing and sealing compounds, structural grouts, epoxy adhesives, floor hardeners and toppings, joint fillers, industrial and architectural coatings, decorative color/stains/stamps, and restoration materials, as well as specialty construction products. The company's Specialty segment provides fluorescent colorants and pigments; shellac-based-specialty and marine coatings; insulated building cladding materials; fire and water damage restoration products; carpet cleaning and disinfecting products; fuel additives; and wood treatments, furniture finishes, and touch-up products. Its Consumer segment offers professional use and do-it-yourself (DIY) products, such as specialty products for paint contractors and the DIYers, deck and fence restoration products, metallic and faux finish coatings, exterior wood deck and concrete restoration systems, flooring finishes, hobby paints and cements, and nail care enamel polish and coating components, as well as caulk, sealant, adhesive, insulating foam, spackling, glazing, and other general patch and repair products. The company was founded in 1947 and is headquartered in Medina, Ohio.

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