Century Aluminum (NASDAQ:CENX) & Outokumpu (OTCMKTS:OUTKY) Critical Review

Century Aluminum (NASDAQ:CENX) and Outokumpu (OTCMKTS:OUTKY) are both mid-cap materials companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, valuation, dividends, profitability, analyst recommendations, institutional ownership and risk.

Analyst Ratings

This is a summary of current ratings and price targets for Century Aluminum and Outokumpu, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Century Aluminum	0	3	4	0	2.57
Outokumpu	0	4	1	0	2.20

Century Aluminum currently has a consensus target price of $62.60, suggesting a potential upside of 90.85%. Given Century Aluminum’s stronger consensus rating and higher possible upside, equities analysts plainly believe Century Aluminum is more favorable than Outokumpu.

Risk & Volatility

Century Aluminum has a beta of 2.17, meaning that its stock price is 117% more volatile than the S&P 500. Comparatively, Outokumpu has a beta of 0.67, meaning that its stock price is 33% less volatile than the S&P 500.

Earnings & Valuation

This table compares Century Aluminum and Outokumpu”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Century Aluminum	$2.53 billion	1.28	$41.80 million	$5.79	5.66
Outokumpu	$6.19 billion	0.39	-$155.00 million	($0.10)	-25.38

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

Profitability

This table compares Century Aluminum and Outokumpu’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Century Aluminum	22.63%	33.83%	15.14%
Outokumpu	-1.48%	-2.38%	-1.41%

Institutional & Insider Ownership

61.6% of Century Aluminum shares are held by institutional investors. 0.8% of Century Aluminum shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Century Aluminum beats Outokumpu on 12 of the 13 factors compared between the two stocks.

About Century Aluminum

Century Aluminum Company, together with its subsidiaries, engages in the production of standard-grade and value-added primary aluminum products in the United States and Iceland. It also owns and operates an alumina production facility in Iceland, and a carbon anode production facility in the Netherlands. The company was founded in 1995 and is headquartered in Chicago, Illinois.

About Outokumpu

Outokumpu Oyj produces and sells various stainless steel products in Finland, other European countries, North America, the Asia-Pacific, and internationally. The company operates through three segments: Europe, Americas, and Ferrochrome. It offers cold rolled coils, strips, and sheets; hot rolled coils, strips, and plates; quarto plates; precision strips; and specialized components, such as welded stainless-steel I-beams, H-beams, hollow-section tubes, bent profiles, structural sections, hardened and customized press plates, suction roll shells, and blancs and disks. The company also provides stainless steel powder which includes Supra 316L, Dura 17-4PH, Ultra 904L, Therma 253MA, Dura 4116, and Ni-free austenitic stainless steel powder; and nickel-based alloys. Its products are used in various applications, including commercial kitchen, cooking, food industry, and home appliances; automotive and transportation; building and infrastructure; energy; marine; and heavy industries. The company was founded in 1910 and is headquartered in Helsinki, Finland.