Allegheny Technologies (NYSE: ATI) and Northwest Pipe (NASDAQ:NWPX) are both basic materials companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, risk, earnings, analyst recommendations, valuation, institutional ownership and profitability.

Analyst Recommendations

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This is a breakdown of recent recommendations and price targets for Allegheny Technologies and Northwest Pipe, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Allegheny Technologies 1 2 6 0 2.56
Northwest Pipe 0 0 1 0 3.00

Allegheny Technologies presently has a consensus target price of $29.22, indicating a potential upside of 13.48%. Given Allegheny Technologies’ higher probable upside, equities analysts plainly believe Allegheny Technologies is more favorable than Northwest Pipe.

Earnings and Valuation

This table compares Allegheny Technologies and Northwest Pipe’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Allegheny Technologies $3.53 billion 0.92 -$91.89 million $0.48 53.65
Northwest Pipe $132.78 million 1.40 -$10.16 million ($0.65) -29.52

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

Volatility & Risk

Allegheny Technologies has a beta of 2.39, indicating that its stock price is 139% more volatile than the S&P 500. Comparatively, Northwest Pipe has a beta of 1.12, indicating that its stock price is 12% more volatile than the S&P 500.

Institutional and Insider Ownership

84.6% of Northwest Pipe shares are held by institutional investors. 1.0% of Allegheny Technologies shares are held by insiders. Comparatively, 2.0% of Northwest Pipe shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Allegheny Technologies and Northwest Pipe’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Allegheny Technologies -2.61% 3.47% 1.06%
Northwest Pipe -7.65% -3.52% -3.11%

Summary

Allegheny Technologies beats Northwest Pipe on 9 of the 14 factors compared between the two stocks.

About Allegheny Technologies

Allegheny Technologies Incorporated manufactures and sells specialty materials and components worldwide. The company operates through two segments, High Performance Materials & Components, and Flat-Rolled Products. The High Performance Materials & Components segment produces, converts, and distributes a range of high performance materials, including titanium and titanium-based alloys; nickel-and cobalt-based alloys and superalloys; zirconium and related alloys, such as hafnium and niobium; powder alloys; and other specialty materials in long product forms of ingots, billets, bars, rods, wires, and shapes and rectangles, as well as seamless tubes, plus precision forgings, castings, components, and machined parts. This segment serves aerospace and defense, medical, oil and gas, and electrical energy markets. The Flat-Rolled Products segment provides stainless steel, nickel-based alloys, specialty alloys, and titanium and titanium-based alloys in various product forms, including plate, sheet, engineered strip, and Precision Rolled Strip products. This segment serves various markets, such as chemical and hydrocarbon processing, automotive, aerospace and defense, food processing equipment and appliances, construction and mining, electronics, communication equipment, and computers. Allegheny Technologies Incorporated was founded in 1960 and is based in Pittsburgh, Pennsylvania.

About Northwest Pipe

Northwest Pipe Company is a manufacturer of engineered steel pipe water systems. The Company produces steel pipeline systems for use in drinking water infrastructure, and has approximately eight manufacturing facilities, located in Portland, Oregon; Denver, Colorado; Adelanto, California; Parkersburg, West Virginia; Saginaw, Texas; St. Louis, Missouri; Salt Lake City, Utah, and Monterrey, Mexico. The Company, through Water Transmission Group, produces engineered welded steel pipe products for use in water transmission applications. The Company’s solutions-based products are used in water transmission, plant piping, tunnels and river crossings applications.

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