Critical Contrast: AptarGroup (NYSE:ATR) versus Nampak (OTCMKTS:NPKLY)

Nampak (OTCMKTS:NPKLY) and AptarGroup (NYSE:ATR) are both materials companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, analyst recommendations, earnings, risk, valuation, profitability and institutional ownership.

Analyst Recommendations

This is a summary of current recommendations for Nampak and AptarGroup, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nampak	0	0	0	0	0.00
AptarGroup	0	3	5	0	2.62

AptarGroup has a consensus price target of $172.80, suggesting a potential upside of 28.19%. Given AptarGroup’s stronger consensus rating and higher possible upside, analysts clearly believe AptarGroup is more favorable than Nampak.

Profitability

This table compares Nampak and AptarGroup’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nampak	N/A	N/A	N/A
AptarGroup	9.22%	13.31%	6.96%

Dividends

Nampak pays an annual dividend of $0.11 per share and has a dividend yield of 0.5%. AptarGroup pays an annual dividend of $1.92 per share and has a dividend yield of 1.4%. Nampak pays out 5.9% of its earnings in the form of a dividend. AptarGroup pays out 34.7% 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. AptarGroup has raised its dividend for 31 consecutive years. AptarGroup is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional and Insider Ownership

0.0% of Nampak shares are owned by institutional investors. Comparatively, 88.5% of AptarGroup shares are owned by institutional investors. 0.7% of AptarGroup shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Nampak and AptarGroup”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nampak	N/A	N/A	N/A	$1.80	11.67
AptarGroup	$3.78 billion	2.27	$392.79 million	$5.53	24.38

AptarGroup has higher revenue and earnings than Nampak. Nampak is trading at a lower price-to-earnings ratio than AptarGroup, indicating that it is currently the more affordable of the two stocks.

Summary

AptarGroup beats Nampak on 13 of the 14 factors compared between the two stocks.

About Nampak

Nampak Limited manufactures and sells metal, plastic, and paper packaging products in South Africa and rest of Africa. It offers HDPE and PET bottles and jars, plastic closures, and crates and drums for the fruit juice, dairy, carbonated soft drink, water, alcoholic beverage, bakery, agriculture, chemical, petroleum, personal care, and household markets. The company also provides aluminum beverage cans and ends for the alcoholic, carbonated soft drink, fruit juice, energy drink, vegetable juice, and ice tea markets; tinplate food cans for the canned food market; and aluminum and tinplate cans, including aerosols, monoblocs, and paint and shoe polish cans to the personal care, household goods, and industrial markets, as well as crowns for the beverage market. In addition, it offers beverage cartons for milk, fruit juice, water, and traditional beer; self-opening paper bags for the flour and sugar markets; and corrugated cases/boxes for the tobacco, poultry, and food and general commercial markets, as well as labels and folding cartons for the tobacco, food, and beverage markets. The company is headquartered in Sandton, South Africa.

About AptarGroup

AptarGroup, Inc. designs and manufactures a range of drug delivery, consumer product dispensing, and active material science solutions and services for the pharmaceutical, beauty, personal care, home care, and food and beverage markets. The company operates through Aptar Pharma, Aptar Beauty, and Aptar Closures segments. It also provides pumps for nasal allergy treatments; and metered dose inhaler valves for respiratory ailments, such as asthma and chronic obstructive pulmonary diseases; elastomer for injectable primary packaging components; and active material science solutions. In addition, the company offers dispensing pumps, closures, elastomeric components, and aerosol valves to the digital health solutions. It primarily sells its products and services in Asia, Europe, Latin America, and North America. AptarGroup, Inc. was incorporated in 1992 and is headquartered in Crystal Lake, Illinois.