Japan Tobacco (OTCMKTS:JAPAY) and Kunlun Energy (OTCMKTS:KLYCY) are both consumer staples companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, valuation, earnings, profitability, risk, analyst recommendations and dividends.
Profitability
This table compares Japan Tobacco and Kunlun Energy's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Japan Tobacco | 13.61% | 11.20% | 5.45% |
| Kunlun Energy | N/A | N/A | N/A |
Risk and Volatility
Japan Tobacco has a beta of 0.42, meaning that its share price is 58% less volatile than the S&P 500. Comparatively, Kunlun Energy has a beta of 1.33, meaning that its share price is 33% more volatile than the S&P 500.
Earnings and Valuation
This table compares Japan Tobacco and Kunlun Energy's revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Japan Tobacco | $19.96 billion | 1.68 | $3.20 billion | $0.90 | 10.52 |
| Kunlun Energy | $16.09 billion | 0.59 | $803.23 million | $1.03 | 10.64 |
Japan Tobacco has higher revenue and earnings than Kunlun Energy. Japan Tobacco is trading at a lower price-to-earnings ratio than Kunlun Energy, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
0.1% of Japan Tobacco shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Analyst Recommendations
This is a summary of current ratings for Japan Tobacco and Kunlun Energy, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Japan Tobacco | 0 | 1 | 0 | 0 | 2.00 |
| Kunlun Energy | 0 | 1 | 0 | 0 | 2.00 |
Dividends
Japan Tobacco pays an annual dividend of $0.51 per share and has a dividend yield of 5.4%. Kunlun Energy pays an annual dividend of $0.32 per share and has a dividend yield of 2.9%. Japan Tobacco pays out 56.7% of its earnings in the form of a dividend. Kunlun Energy pays out 31.1% 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.
Summary
Japan Tobacco beats Kunlun Energy on 9 of the 12 factors compared between the two stocks.
