Worthington Steel (NYSE:WS – Get Free Report) and Olympic Steel (NASDAQ:ZEUS – Get Free Report) are both small-cap materials companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, profitability, institutional ownership, earnings, valuation, risk and analyst recommendations.
Dividends
Worthington Steel pays an annual dividend of $0.64 per share and has a dividend yield of 1.7%. Olympic Steel pays an annual dividend of $0.64 per share and has a dividend yield of 1.3%. Worthington Steel pays out -104.9% of its earnings in the form of a dividend. Olympic Steel pays out 54.7% 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. Olympic Steel has raised its dividend for 4 consecutive years. Worthington Steel is clearly the better dividend stock, given its higher yield and lower payout ratio.
Profitability
This table compares Worthington Steel and Olympic Steel’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Worthington Steel | -0.56% | 7.49% | 3.14% |
| Olympic Steel | 0.73% | 2.11% | 1.14% |
Earnings and Valuation
This table compares Worthington Steel and Olympic Steel”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Worthington Steel | $3.44 billion | 0.55 | $8.50 million | ($0.61) | -60.26 |
| Olympic Steel | $1.90 billion | 0.28 | $22.98 million | $1.17 | 40.91 |
Olympic Steel has lower revenue, but higher earnings than Worthington Steel. Worthington Steel 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 & Volatility
Worthington Steel has a beta of 2.12, indicating that its stock price is 112% more volatile than the S&P 500. Comparatively, Olympic Steel has a beta of 1.75, indicating that its stock price is 75% more volatile than the S&P 500.
Analyst Ratings
This is a summary of recent ratings for Worthington Steel and Olympic Steel, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Worthington Steel | 1 | 1 | 1 | 0 | 2.00 |
| Olympic Steel | 0 | 1 | 0 | 0 | 2.00 |
Worthington Steel presently has a consensus price target of $46.00, indicating a potential upside of 25.14%. Given Worthington Steel’s higher probable upside, research analysts clearly believe Worthington Steel is more favorable than Olympic Steel.
Insider & Institutional Ownership
45.4% of Worthington Steel shares are held by institutional investors. Comparatively, 87.1% of Olympic Steel shares are held by institutional investors. 2.7% of Worthington Steel shares are held by company insiders. Comparatively, 13.8% of Olympic Steel shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Summary
Worthington Steel beats Olympic Steel on 9 of the 16 factors compared between the two stocks.
About Worthington Steel
Worthington Steel, Inc. operates as a steel processor in North America. It offers carbon flat-rolled steel and tailor welded blanks, as well as electrical steel laminations; and aluminum tailor welded blanks. The company serves various end-markets, including automotive, heavy truck, agriculture, construction, and energy. Worthington Steel, Inc. was incorporated in 2023 and is based in Columbus, Ohio.
About Olympic Steel
Olympic Steel, Inc. processes, distributes, and stores metal products primarily in the United States, Canada, and Mexico. It operates in three segments: Carbon Flat Products; Specialty Metals Flat Products; and Tubular and Pipe Products. The company offers stainless steel and aluminum coil and sheet products, angles, rounds, and flat bars; alloy, heat treated, and abrasion resistant coils, sheets and plates; coated metals, including galvanized, galvannealed, electro galvanized, advanced high strength steels, aluminized, and automotive grades of steel; commercial quality, advanced high strength steel, drawing steel, and automotive grades cold rolled steel coil and sheet products; hot rolled carbon comprising hot rolled coil, pickled and oiled sheet and plate steel products, automotive grades, advanced high strength steels, and high strength low alloys; tube, pipe, and bar products, including round, square, and rectangular mechanical and structural tubing; hydraulic and stainless tubing; boiler tubing; carbon, stainless, and aluminum pipes; valves and fittings; and tin mill products, such as electrolytic tinplate, electrolytic chromium coated steel, and black plates. The company also provides cutting-to-length, slitting, shearing, blanking, tempering, stretcher-leveling, plate and laser processing, forming and machining, tube processing, finishing, and fabrication services, as well as value-added services, such as saw cutting, laser cutting, beveling, threading, and grooving services. It serves metal consuming industries, such as manufacturers and fabricators of transportation and material handling lift equipment, construction, mining and farm equipment, agriculture equipment, storage tanks, environmental and energy generation equipment, automobiles, food service, and electrical equipment, as well as general and plate fabricators, and metals service centers through direct sales force. Olympic Steel, Inc. was founded in 1954 and is based in Highland Hills, Ohio.
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