National Steel (NYSE: SID) and L.B. Foster (NASDAQ:FSTR) are both basic materials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, earnings, dividends, valuation, profitabiliy and institutional ownership.

Volatility & Risk

National Steel has a beta of 2.27, meaning that its stock price is 127% more volatile than the S&P 500. Comparatively, L.B. Foster has a beta of 2.25, meaning that its stock price is 125% more volatile than the S&P 500.

Profitability

This table compares National Steel and L.B. Foster’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
National Steel N/A N/A N/A
L.B. Foster -30.60% -28.38% -10.59%

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for National Steel and L.B. Foster, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
National Steel 0 0 0 0 N/A
L.B. Foster 0 0 0 0 N/A

Insider & Institutional Ownership

3.4% of National Steel shares are owned by institutional investors. Comparatively, 65.1% of L.B. Foster shares are owned by institutional investors. 15.2% of L.B. Foster shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Valuation & Earnings

This table compares National Steel and L.B. Foster’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
National Steel $5.24 billion 0.63 $937.24 million $0.25 9.56
L.B. Foster $475.91 million 0.37 $20.86 million ($13.74) -1.25

National Steel has higher revenue and earnings than L.B. Foster. L.B. Foster is trading at a lower price-to-earnings ratio than National Steel, indicating that it is currently the more affordable of the two stocks.

Dividends

L.B. Foster pays an annual dividend of $0.04 per share and has a dividend yield of 0.2%. National Steel does not pay a dividend. L.B. Foster pays out -0.3% of its earnings in the form of a dividend. L.B. Foster has increased its dividend for 2 consecutive years.

Summary

National Steel beats L.B. Foster on 8 of the 13 factors compared between the two stocks.

National Steel Company Profile

Companhia Siderurgica Nacional is a Brazil-based company engaged in the steel industry. The Company operates throughout the entire steel production chain, from the mining of iron ore to the production and sale of a range of steel products, including coated galvanized flat steel and tinplate. The Company operates in five segments: Steel, Mining, Cement, Logistics and Energy. The Steel segment focuses on the production, distribution and sale of flat steel, long steel, metallic containers and galvanized steel, with operations in Brazil, the United States, Portugal and Germany. The Mining segment encompasses the activities of iron ore and tin mining. The Cement segment is responsible for the cement production, distribution and sale operations. The Logistics segment manages port terminal for containers, as well as railway networks. The Energy segment includes generation of electric power. The Company is controlled by Vicunha Acos SA.

L.B. Foster Company Profile

L.B. Foster Company is a manufacturer, fabricator and distributor of products and services for the rail, construction, energy and utility markets. The Company’s segments include Rail Products and Services, Construction Products, and Tubular and Energy Services. Its Rail Products segment provides a range of new and used rail, trackwork and accessories to railroads, mines and industry. The Rail segment designs and produces concrete railroad ties, insulated rail joints, power rail, track fasteners, coverboards and special accessories for mass transit and other rail systems. The Construction Products segment sells and rents steel sheet piling, H-bearing pile and other piling products for foundation and earth retention requirements. The Tubular and Energy Services segment supplies pipe coatings for natural gas pipelines and utilities, blending, injection and metering equipment for the oil and gas market, and produces threaded pipe products for industrial water well and irrigation markets.

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