Analyzing Norsk Hydro ASA (OTCMKTS:NHYDY) and USA Rare Earth (NASDAQ:USAR)

USA Rare Earth (NASDAQ:USAR) and Norsk Hydro ASA (OTCMKTS:NHYDY) are both materials companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, profitability, risk, earnings, valuation and institutional ownership.

Insider and Institutional Ownership

0.0% of Norsk Hydro ASA shares are owned by institutional investors. 9.1% of USA Rare Earth shares are owned by company insiders. Comparatively, 0.0% of Norsk Hydro ASA shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Analyst Ratings

This is a summary of recent ratings for USA Rare Earth and Norsk Hydro ASA, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
USA Rare Earth	1	0	9	0	2.80
Norsk Hydro ASA	3	6	2	1	2.08

USA Rare Earth currently has a consensus price target of $35.83, suggesting a potential upside of 93.59%. Given USA Rare Earth’s stronger consensus rating and higher possible upside, equities analysts clearly believe USA Rare Earth is more favorable than Norsk Hydro ASA.

Volatility and Risk

USA Rare Earth has a beta of 2.55, meaning that its stock price is 155% more volatile than the S&P 500. Comparatively, Norsk Hydro ASA has a beta of 1.02, meaning that its stock price is 2% more volatile than the S&P 500.

Valuation and Earnings

This table compares USA Rare Earth and Norsk Hydro ASA”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
USA Rare Earth	$1.64 million	2,517.36	-$297.56 million	($2.43)	-7.62
Norsk Hydro ASA	$20.05 billion	0.94	$647.52 million	$0.52	18.37

Norsk Hydro ASA has higher revenue and earnings than USA Rare Earth. USA Rare Earth is trading at a lower price-to-earnings ratio than Norsk Hydro ASA, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares USA Rare Earth and Norsk Hydro ASA’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
USA Rare Earth	N/A	-9.04%	-7.13%
Norsk Hydro ASA	4.90%	12.01%	6.28%

Summary

Norsk Hydro ASA beats USA Rare Earth on 9 of the 15 factors compared between the two stocks.

About USA Rare Earth

USA Rare Earth, Inc. is domestic supplier of rare earth magnets and heavy rare earth elements. It is developing a vertically integrated, domestic supply chain for rare earth element magnet production, with a facility in Stillwater, Oklahoma, and mining rights to the Round Top heavy rare earth and critical minerals deposit in West Texas. The company was founded in May 2019 and is headquartered in Stillwater, OK.

About Norsk Hydro ASA

Norsk Hydro ASA engages in the power production, bauxite extraction, alumina refining, aluminium smelting, and recycling activities; and provision of extruded solutions worldwide. It operates through Hydro Bauxite & Alumina, Hydro Aluminium Metal, Hydro Metal Markets, Hydro Extrusions, and Hydro Energy segments. The Hydro Bauxite & Alumina segment engages in bauxite mining activities, production of alumina, and related commercial activities, primarily the sale of alumina. The Hydro Aluminium Metal segment is involved in the primary aluminum production casting activities. This segment principally offers extrusion ingots, foundry alloys, and sheet and standard ingots. The Metal Markets segment sells products from the company’s primary metal plants; operates recyclers; and trades in physical and financial metals. The Hydro Extrusions segment offers extrusion profiles, building systems, and precision tubing products for construction, automotive and heating, and ventilation and air conditioning sectors, as well as operates recycling facilities. The Hydro Energy segment engages in the trading and wholesale business in Brazil; energy sourcing operations; and operation of power stations in Norway, as well as renewable energy production, such as wind and solar, battery materials, and green hydrogen. Norsk Hydro ASA was founded in 1905 and is headquartered in Oslo, Norway.