Critical Review: PolyOne (POL) and Its Rivals

PolyOne (NYSE: POL) is one of 14 public companies in the “Plastics materials & resins” industry, but how does it weigh in compared to its peers? We will compare PolyOne to related companies based on the strength of its institutional ownership, analyst recommendations, valuation, risk, earnings, profitability and dividends.

Analyst Ratings

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This is a breakdown of recent recommendations for PolyOne and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
PolyOne 0 3 4 0 2.57
PolyOne Competitors 42 359 664 22 2.61

PolyOne currently has a consensus target price of $45.00, indicating a potential upside of 1.93%. As a group, “Plastics materials & resins” companies have a potential upside of 13.87%. Given PolyOne’s peers stronger consensus rating and higher probable upside, analysts plainly believe PolyOne has less favorable growth aspects than its peers.

Profitability

This table compares PolyOne and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
PolyOne -1.73% 29.46% 6.68%
PolyOne Competitors 6.60% 23.59% 8.10%

Insider and Institutional Ownership

93.9% of PolyOne shares are owned by institutional investors. Comparatively, 80.9% of shares of all “Plastics materials & resins” companies are owned by institutional investors. 1.3% of PolyOne shares are owned by company insiders. Comparatively, 1.6% of shares of all “Plastics materials & resins” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Dividends

PolyOne pays an annual dividend of $0.70 per share and has a dividend yield of 1.6%. PolyOne pays out 31.7% of its earnings in the form of a dividend. As a group, “Plastics materials & resins” companies pay a dividend yield of 2.1% and pay out 30.6% of their earnings in the form of a dividend. PolyOne has raised its dividend for 6 consecutive years. PolyOne lags its peers as a dividend stock, given its lower dividend yield and higher payout ratio.

Valuation and Earnings

This table compares PolyOne and its peers top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
PolyOne $3.23 billion -$57.70 million 19.98
PolyOne Competitors $9.05 billion $413.23 million 17.45

PolyOne’s peers have higher revenue and earnings than PolyOne. PolyOne is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Risk & Volatility

PolyOne has a beta of 1.65, indicating that its stock price is 65% more volatile than the S&P 500. Comparatively, PolyOne’s peers have a beta of -2.66, indicating that their average stock price is 366% less volatile than the S&P 500.

Summary

PolyOne peers beat PolyOne on 11 of the 15 factors compared.

PolyOne Company Profile

PolyOne Corporation (PolyOne) provides specialized polymer materials, services and solutions. The Company’s segments include Color, Additives and Inks; Specialty Engineered Materials; Performance Products and Solutions, and PolyOne Distribution. The Color, Additives and Inks segment provides custom color and additive concentrates in solid and liquid form for thermoplastics, dispersions for thermosets. The Specialty Engineered Materials segment provides specialty polymer formulations, services and solutions for designers, assemblers and processors of thermoplastic materials. The Performance Products and Solutions segment consists of the Geon Performance Materials and Producer Services business units. As of December 31, 2016, the PolyOne Distribution segment distributed more than 4,000 grades of engineering and commodity grade resins.

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