Multi-Color (NASDAQ: LABL) and LSC Communications (NYSE:LKSD) are both small-cap industrial products companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, profitability, risk, earnings, analyst recommendations, dividends and valuation.
Insider & Institutional Ownership
66.6% of Multi-Color shares are owned by institutional investors. Comparatively, 84.4% of LSC Communications shares are owned by institutional investors. 19.4% of Multi-Color shares are owned by company insiders. Comparatively, 2.5% of LSC Communications 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.
This is a summary of current ratings and recommmendations for Multi-Color and LSC Communications, as provided by MarketBeat.
||Strong Buy Ratings
Multi-Color currently has a consensus target price of $78.33, suggesting a potential upside of 3.27%. LSC Communications has a consensus target price of $24.00, suggesting a potential upside of 51.23%. Given LSC Communications’ stronger consensus rating and higher possible upside, analysts plainly believe LSC Communications is more favorable than Multi-Color.
Multi-Color pays an annual dividend of $0.20 per share and has a dividend yield of 0.3%. LSC Communications pays an annual dividend of $1.00 per share and has a dividend yield of 6.3%. Multi-Color pays out 5.9% of its earnings in the form of a dividend. LSC Communications pays out 344.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
Valuation & Earnings
This table compares Multi-Color and LSC Communications’ gross revenue, earnings per share (EPS) and valuation.
||Earnings Per Share
LSC Communications has higher revenue and earnings than Multi-Color. Multi-Color is trading at a lower price-to-earnings ratio than LSC Communications, indicating that it is currently the more affordable of the two stocks.
This table compares Multi-Color and LSC Communications’ net margins, return on equity and return on assets.
||Return on Equity
||Return on Assets
Risk & Volatility
Multi-Color has a beta of 0.73, indicating that its share price is 27% less volatile than the S&P 500. Comparatively, LSC Communications has a beta of 5.95, indicating that its share price is 495% more volatile than the S&P 500.
LSC Communications beats Multi-Color on 8 of the 15 factors compared between the two stocks.
Multi-Color Company Profile
Multi-Color Corporation (Multi-Color) is engaged in label solutions business, supporting brands, including producers of home and personal care, wine and spirit, food and beverage, healthcare and specialty consumer products. The Company serves international brand owners in North, Central and South America, Europe, Australia, New Zealand, South Africa and China and Southeast Asia with a range of label technologies in Pressure Sensitive, Glue-Applied (Cut and Stack), In-Mold, Shrink Sleeve and Heat Transfer. The Company also provides a range of print methods, including flexographic, lithographic, rotogravure, letterpress and digital, and in-house prepress services. The Company provides graphics and pre-press services for its customers at all of its manufacturing locations. These services include the conversion of customer digital files and artwork into proofs, production of print layouts and printing plates, and product mock ups and samples for market research.
LSC Communications Company Profile
LSC Communications, Inc. focuses on traditional and digital print, print-related services and office products. The Company’s segments are Print and Office Products. The Company, through its Print segment, provides a range of print product offerings, which include magazines, catalogs, retail inserts, books and directories. In addition to printed products, the Company also provides a number of print-related services, such as supply chain management, mail services, e-book formatting and distribution services. Its Print segment services over 3,000 customers, including publishers of magazines, books and directories, online retailers, catalogers, mass merchandisers and contract stationers. In its Office Products segment, the Company manufactures and sells a range of branded and private label products, primarily within the core categories, including filing products; note-taking products; binder products; tax and stock forms, and envelopes.
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