By otakuyassine3@gmail.com 
Shin-Etsu Chemical (OTCMKTS:SHECY – Get Free Report) and H & M Hennes & Mauritz AB (publ) (OTCMKTS:HNNMY – Get Free Report) are both large-cap basic materials companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, earnings, analyst recommendations, valuation and dividends.
Dividends
Shin-Etsu Chemical pays an annual dividend of $0.23 per share and has a dividend yield of 1.5%. H & M Hennes & Mauritz AB (publ) pays an annual dividend of $0.07 per share and has a dividend yield of 2.5%. Shin-Etsu Chemical pays out 27.1% of its earnings in the form of a dividend. H & M Hennes & Mauritz AB (publ) pays out 58.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.
Valuation & Earnings
This table compares Shin-Etsu Chemical and H & M Hennes & Mauritz AB (publ)”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Shin-Etsu Chemical | $16.73 billion | 3.72 | $3.44 billion | $0.85 | 18.42 |
| H & M Hennes & Mauritz AB (publ) | $22.22 billion | 0.88 | $824.44 million | $0.12 | 22.92 |
Shin-Etsu Chemical has higher earnings, but lower revenue than H & M Hennes & Mauritz AB (publ). Shin-Etsu Chemical is trading at a lower price-to-earnings ratio than H & M Hennes & Mauritz AB (publ), indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Shin-Etsu Chemical and H & M Hennes & Mauritz AB (publ)’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Shin-Etsu Chemical | 20.59% | 11.12% | 9.62% |
| H & M Hennes & Mauritz AB (publ) | 4.30% | 23.03% | 5.76% |
Insider and Institutional Ownership
0.0% of Shin-Etsu Chemical shares are held by institutional investors. Comparatively, 0.0% of H & M Hennes & Mauritz AB (publ) shares are held by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Risk & Volatility
Shin-Etsu Chemical has a beta of 1.24, meaning that its share price is 24% more volatile than the S&P 500. Comparatively, H & M Hennes & Mauritz AB (publ) has a beta of 1.43, meaning that its share price is 43% more volatile than the S&P 500.
Analyst Recommendations
This is a summary of current ratings for Shin-Etsu Chemical and H & M Hennes & Mauritz AB (publ), as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Shin-Etsu Chemical | 0 | 0 | 0 | 0 | 0.00 |
| H & M Hennes & Mauritz AB (publ) | 1 | 1 | 2 | 1 | 2.60 |
Summary
H & M Hennes & Mauritz AB (publ) beats Shin-Etsu Chemical on 8 of the 15 factors compared between the two stocks.
About Shin-Etsu Chemical
Shin-Etsu Chemical Co., Ltd. provides infrastructure, electronics, and functional materials in Japan. It is also involved in processing and specialized related services. The company operates through Infrastructure Materials; Electronics Materials; Functional Materials; and Processing and Specialized Services segments. In addition, it offers cellulose derivatives, synthetic pheromones, aroma chemicals, dielectric and LED/ semiconductor materials, silanes, photoresists, chlorides, caustic soda, liquid fluoroelastomers, polyvinyl chloride and vinyl acetate resin, silicones, and silicones processed goods. Further, the company offers pellicles, photomask blanks, synthetic quartz/ quartz cloth, pyrolytic boron nitride, LIB anode material, and silicon metal. Additionally, it provides rare earth magnets, compound semiconductors, and oxide single crystals. The company was formerly known as Shin-Etsu Nitrogen Fertilizer Co., Ltd. and changed its name to Shin-Etsu Chemical Co., Ltd. in 1940. Shin-Etsu Chemical Co., Ltd. was incorporated in 1926 and is headquartered in Tokyo, Japan.
About H & M Hennes & Mauritz AB (publ)
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H & M Hennes & Mauritz AB (publ) provides clothing, accessories, footwear, cosmetics, home textiles, and homeware for women, men, and children worldwide. It offers sportswear, shoes, bags, beauty products, activewear, jeans, and ready-to-wear; and interior products, including bed linens, dinnerware, textiles, furniture, and lighting. The company provides its products under the H&M, H&M HOME, H&M Move, H&M Beauty, COS, Weekday, Monki, & Other Stories, ARKET, Afound, and Singular Society brand names. In addition, it operates Sellpy, a broad digital platform for second-hand fashion and other products; and Creator Studio, a global platform for merchandise design and production, as well as provides solutions to extend the useful life of unwanted garments through reuse and recycling under Looper Textile name. The company offers its products through online and physical stores. H & M Hennes & Mauritz AB (publ) was incorporated in 1943 and is headquartered in Stockholm, Sweden.
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