Contrasting Salzgitter (OTCMKTS:SZGPY) and SSAB (OTCMKTS:SSAAY)

Salzgitter (OTCMKTS:SZGPY) and SSAB (OTCMKTS:SSAAY) are both basic materials companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, earnings, dividends, profitability, valuation, analyst recommendations and institutional ownership.

Risk & Volatility

Salzgitter has a beta of 1.5, meaning that its share price is 50% more volatile than the S&P 500. Comparatively, SSAB has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations for Salzgitter and SSAB, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Salzgitter	2	2	1	1	2.17
SSAB	0	2	1	0	2.33

Profitability

This table compares Salzgitter and SSAB’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Salzgitter	-4.45%	-9.40%	-4.03%
SSAB	5.17%	7.45%	4.85%

Dividends

Salzgitter pays an annual dividend of $0.01 per share and has a dividend yield of 0.3%. SSAB pays an annual dividend of $0.09 per share and has a dividend yield of 2.8%. Salzgitter pays out -1.2% of its earnings in the form of a dividend. SSAB pays out 36.0% 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.

Valuation & Earnings

This table compares Salzgitter and SSAB”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Salzgitter	$10.83 billion	0.16	-$381.12 million	($0.86)	-3.76
SSAB	$9.78 billion	0.66	$617.08 million	$0.25	12.92

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

Summary

SSAB beats Salzgitter on 9 of the 13 factors compared between the two stocks.

About Salzgitter

Salzgitter AG, together with its subsidiaries, engages in steel and technology businesses worldwide. It operates through four segments: Steel Production, Steel Processing, Trading, and Technology. The Steel Production segment manufactures steel and special steels, such as hot-rolled wide strip, steel sheet, sections, tailored blanks, as well as scrap trading. The Steel Processing segment produces various high-grade heavy plates; and manufactures line pipes, HFI-welded tubes, and precision and stainless-steel tubes. The Trading segment operates a European sales network, as well as trading companies and agencies worldwide. The Technology segment engages in the provision of machinery and plants for the filling and packaging of beverages, as well as special machinery engineering for shoe manufacturing and elastomer production. The company also provides IT, facility management, logistics, automotive engineering, and research and development services, as well as supplies raw materials. The company was founded in 1858 and is headquartered in Salzgitter, Germany.

About SSAB

SSAB AB (publ) produces and sells steel products in Sweden, Finland, Rest of Europe, the United States, and internationally. It operates through five segments: SSAB Special Steels, SSAB Europe, SSAB Americas, Tibnor, and Ruukki Construction. The SSAB Special Steels segment offers quenched and tempered steels, and advanced high-strength steel products for steel and plate production. The SSAB Europe segment provides strip, heavy plate, and tubular products. The SSAB Americas segment sells heavy plates for steel and plate production. The Tibnor segment distributes a range of steel and non-ferrous metals in the Nordics and Baltics. The Ruukki Construction segment produces and sells energy-efficient building and construction solutions. It markets its steel products under the Strenx, Hardox, Docol, GreenCoat, Toolox, Armox, Duroxite, SSAB AM, SSAB Boron, SSAB Domex, SSAB Form, SSAB Laser, SSAB Weathering, Cor-Ten, and SSAB Multisteel brands. The company's products are used by customers in the heavy transport, construction and infrastructure, industrial applications, construction machinery, energy, and material handling markets. SSAB AB (publ) was founded in 1878 and is headquartered in Stockholm, Sweden.