SSAB (OTCMKTS:SSAAY) vs. Commercial Metals (NYSE:CMC) Head to Head Contrast

Commercial Metals (NYSE:CMC) and SSAB (OTCMKTS:SSAAY) are both mid-cap basic materials companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, risk, institutional ownership, valuation, analyst recommendations and dividends.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Commercial Metals and SSAB, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Commercial Metals	0	6	6	1	2.62
SSAB	0	2	1	0	2.33

Commercial Metals presently has a consensus target price of $64.20, suggesting a potential downside of 1.52%. Given Commercial Metals’ stronger consensus rating and higher probable upside, research analysts plainly believe Commercial Metals is more favorable than SSAB.

Dividends

Commercial Metals pays an annual dividend of $0.72 per share and has a dividend yield of 1.1%. SSAB pays an annual dividend of $0.09 per share and has a dividend yield of 2.5%. Commercial Metals pays out 94.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. SSAB pays out 36.0% of its earnings in the form of a dividend. Commercial Metals has increased its dividend for 4 consecutive years. SSAB is clearly the better dividend stock, given its higher yield and lower payout ratio.

Earnings & Valuation

This table compares Commercial Metals and SSAB”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Commercial Metals	$7.80 billion	0.93	$84.66 million	$0.76	85.78
SSAB	$9.78 billion	0.73	$617.08 million	$0.25	14.40

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

Volatility and Risk

Commercial Metals has a beta of 1.49, indicating that its share price is 49% more volatile than the S&P 500. Comparatively, SSAB has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500.

Insider & Institutional Ownership

86.9% of Commercial Metals shares are owned by institutional investors. 0.5% of Commercial Metals shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Commercial Metals	1.09%	8.76%	5.17%
SSAB	5.17%	7.33%	4.77%

Summary

Commercial Metals beats SSAB on 13 of the 18 factors compared between the two stocks.

About Commercial Metals

Commercial Metals Company manufactures, recycles, and fabricates steel and metal products, and related materials and services in the United States, Poland, China, and internationally. It operates through two segments, North America and Europe. The company processes and sells ferrous and nonferrous scrap metals to steel mills and foundries, aluminum sheet and ingot manufacturers, brass and bronze ingot makers, copper refineries and mills, secondary lead smelters, specialty steel mills, high temperature alloy manufacturers, and other consumers. It also manufactures and sells finished long steel products, including reinforcing bar, merchant bar, light structural, and other special sections, as well as semi-finished billets for rerolling and forging applications. In addition, the company provides fabricated rebar used to reinforce concrete primarily in the construction of commercial and non-commercial buildings, hospitals, convention centers, industrial plants, power plants, highways, bridges, arenas, stadiums, and dams; sells and rents construction-related products and equipment to concrete installers and other businesses; and manufactures and sells strength bars for the truck trailer industry, special bar steels for the energy market, and armor plates for military vehicles. Further, it manufactures rebars, merchant bars, and wire rods; and sells fabricated rebars, wire meshes, fabricated meshes, assembled rebar cages, and other fabricated rebar by-products to fabricators, manufacturers, distributors, and construction companies. The company was founded in 1915 and is headquartered in Irving, Texas.

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.