Canfor Pulp Products (OTCMKTS: CFPUF) and Essendant (NASDAQ:ESND) are both small-cap basic materials companies, but which is the superior business? We will compare the two companies based on the strength of their earnings, dividends, risk, institutional ownership, valuation, profitability and analyst recommendations.

Analyst Recommendations

This is a summary of current ratings for Canfor Pulp Products and Essendant, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Canfor Pulp Products 0 0 0 0 N/A
Essendant 0 1 0 0 2.00

Essendant has a consensus target price of $10.00, suggesting a potential downside of 27.64%. Given Essendant’s higher probable upside, analysts plainly believe Essendant is more favorable than Canfor Pulp Products.

Profitability

This table compares Canfor Pulp Products and Essendant’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Canfor Pulp Products N/A N/A N/A
Essendant -2.59% 2.22% 0.63%

Insider and Institutional Ownership

93.3% of Essendant shares are owned by institutional investors. 2.7% of Essendant shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Dividends

Essendant pays an annual dividend of $0.56 per share and has a dividend yield of 4.1%. Canfor Pulp Products does not pay a dividend.

Earnings and Valuation

This table compares Canfor Pulp Products and Essendant’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Canfor Pulp Products N/A N/A N/A N/A N/A
Essendant $5.04 billion 0.10 -$266.98 million N/A N/A

Canfor Pulp Products has higher earnings, but lower revenue than Essendant.

Summary

Essendant beats Canfor Pulp Products on 7 of the 8 factors compared between the two stocks.

About Canfor Pulp Products

Canfor Pulp Products Inc., together with its subsidiaries, produces and supplies pulp and paper products worldwide. The company operates through two segments, Pulp and Paper. It offers solid wood; bleached and unbleached softwood pulp; and bleached and unbleached kraft, and coloured kraft papers. The company also supplies fiber products; and produces green energy. The company was incorporated in 2010 and is headquartered in Vancouver, Canada. Canfor Pulp Products Inc. is a subsidiary of Canadian Forest Products Ltd.

About Essendant

Essendant Inc. operates as a distributor of workplace items in the United States and internationally. It offers janitorial and sanitation supplies, breakroom items, foodservice consumables, safety and security items, and paper and packaging supplies. The company also provides technology products, such as computer accessories, imaging supplies, and data storage products; and computer hardware, including printers and other peripherals. In addition, it offers traditional office products, including writing instruments, business machines, filing and record storage products, presentation products, shipping and mailing supplies, calendars, and general office accessories; and industrial supplies, such as hand and power tools, safety and security supplies, janitorial equipment, and oilfield and welding supplies, as well as industrial maintenance, repair, and operations items. Further, the company provides cut sheet paper products; automotive products; and desks, filing and storage solutions, and seating and systems furniture, as well as various products for education, government, healthcare, and professional services markets. It serves office and workplace dealers; facilities and maintenance distributors; technology, military, automotive aftermarket, healthcare, and other vertical suppliers; industrial resellers; national resellers; and resellers in the e-commerce channel. Essendant Inc. distributes its products through 70 distribution centers to approximately 29,000 reseller customers, as well as through online. The company was formerly known as United Stationers Inc. and changed its name to Essendant Inc. in June 2015. Essendant Inc. was founded in 1922 and is headquartered in Deerfield, Illinois.

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