Olympic Steel (ZEUS) versus Dynamic Materials Corp. (BOOM) Critical Comparison
Olympic Steel (NASDAQ: ZEUS) and Dynamic Materials Corp. (NASDAQ:BOOM) are both small-cap basic materials companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, profitability, risk, analyst recommendations, dividends, institutional ownership and valuation.
Institutional & Insider Ownership
71.3% of Olympic Steel shares are owned by institutional investors. Comparatively, 85.5% of Dynamic Materials Corp. shares are owned by institutional investors. 18.3% of Olympic Steel shares are owned by company insiders. Comparatively, 5.1% of Dynamic Materials Corp. shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
This is a summary of current ratings and recommmendations for Olympic Steel and Dynamic Materials Corp., as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Dynamic Materials Corp.||0||0||1||0||3.00|
Olympic Steel currently has a consensus target price of $22.33, suggesting a potential upside of 30.15%. Dynamic Materials Corp. has a consensus target price of $19.00, suggesting a potential upside of 47.86%. Given Dynamic Materials Corp.’s stronger consensus rating and higher possible upside, analysts plainly believe Dynamic Materials Corp. is more favorable than Olympic Steel.
Olympic Steel pays an annual dividend of $0.08 per share and has a dividend yield of 0.5%. Dynamic Materials Corp. pays an annual dividend of $0.08 per share and has a dividend yield of 0.6%. Olympic Steel pays out 10.7% of its earnings in the form of a dividend. Dynamic Materials Corp. pays out -14.0% 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. Dynamic Materials Corp. is clearly the better dividend stock, given its higher yield and lower payout ratio.
This table compares Olympic Steel and Dynamic Materials Corp.’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Dynamic Materials Corp.||-5.01%||-6.38%||-4.39%|
Valuation & Earnings
This table compares Olympic Steel and Dynamic Materials Corp.’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Olympic Steel||$1.21 billion||0.16||$36.12 million||$0.75||22.88|
|Dynamic Materials Corp.||$162.88 million||1.17||$7.00 million||($0.57)||-22.54|
Olympic Steel has higher revenue and earnings than Dynamic Materials Corp.. Dynamic Materials Corp. is trading at a lower price-to-earnings ratio than Olympic Steel, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Olympic Steel has a beta of 1.73, indicating that its stock price is 73% more volatile than the S&P 500. Comparatively, Dynamic Materials Corp. has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500.
Olympic Steel beats Dynamic Materials Corp. on 9 of the 15 factors compared between the two stocks.
Olympic Steel Company Profile
Olympic Steel, Inc. is a metals service center. The Company provides metals processing and distribution services for a range of customers. The Company operates through three segments: carbon flat products, specialty metals flat products, and tubular and pipe products. The Company’s carbon flat products segment’s focus is on the direct sale and distribution of large volumes of processed carbon and coated flat-rolled sheet, coil and plate products and fabricated parts. The Company’s specialty metals flat products segment’s focus is on the direct sale and distribution of processed aluminum and stainless flat-rolled sheet and coil products, flat bar products and fabricated parts. The Company’s tubular and pipe products segment consists of the Chicago Tube and Iron Company (CTI) business. Through its tubular and pipe products segment, it distributes metals tubing, pipe, bar, valve and fittings, and fabricate pressure parts supplied to various industrial markets.
Dynamic Materials Corp. Company Profile
DMC Global Inc., formerly Dynamic Materials Corporation, is a diversified technology company. The Company operates a family of technical product and process businesses serving the energy, industrial and infrastructure markets. The Company’s businesses operate through an international network of manufacturing, distribution and sales facilities. The Company’s segments are NobelClad and DynaEnergetics. The NobelClad segment is engaged in the production of explosion-welded clad metal plates for use in the construction of corrosion resistant industrial processing equipment and specialized transition joints. The DynaEnergetics segment manufactures, markets and sells oilfield perforating equipment and explosives, including detonating cords, detonators, bi-directional boosters and shaped charges, and seismic related explosives and accessories. It owns explosive metalworking and metallic processes, and registered trademarks, including Detaclad, Detacouple, EFTEK, ETJ 2000 and NOBELCLAD.
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