Nippon Steel & Sumitomo Metal (OTCMKTS:NPSCY) & Salzgitter (OTCMKTS:SZGPY) Head to Head Analysis

Nippon Steel & Sumitomo Metal (OTCMKTS:NPSCY) and Salzgitter (OTCMKTS:SZGPY) are both basic materials companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, earnings, institutional ownership, risk and profitability.

Valuation & Earnings

This table compares Nippon Steel & Sumitomo Metal and Salzgitter”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Nippon Steel & Sumitomo Metal	$57.10 billion	0.38	$2.31 billion	($0.03)	-226.83
Salzgitter	$10.83 billion	0.13	-$381.12 million	($0.86)	-3.09

Nippon Steel & Sumitomo Metal has higher revenue and earnings than Salzgitter. Nippon Steel & Sumitomo Metal is trading at a lower price-to-earnings ratio than Salzgitter, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Nippon Steel & Sumitomo Metal and Salzgitter’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Nippon Steel & Sumitomo Metal	-0.42%	-0.61%	-0.30%
Salzgitter	-4.45%	-9.45%	-4.07%

Risk and Volatility

Nippon Steel & Sumitomo Metal has a beta of 0.8, indicating that its stock price is 20% less volatile than the S&P 500. Comparatively, Salzgitter has a beta of 1.41, indicating that its stock price is 41% more volatile than the S&P 500.

Dividends

Nippon Steel & Sumitomo Metal pays an annual dividend of $0.25 per share and has a dividend yield of 3.7%. Salzgitter pays an annual dividend of $0.01 per share and has a dividend yield of 0.4%. Nippon Steel & Sumitomo Metal pays out -833.3% of its earnings in the form of a dividend. Salzgitter pays out -1.2% 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. Nippon Steel & Sumitomo Metal is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Ratings

This is a breakdown of current ratings for Nippon Steel & Sumitomo Metal and Salzgitter, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Nippon Steel & Sumitomo Metal	0	0	0	0	0.00
Salzgitter	2	1	0	1	2.00

Summary

Nippon Steel & Sumitomo Metal beats Salzgitter on 9 of the 13 factors compared between the two stocks.

About Nippon Steel & Sumitomo Metal

Nippon Steel Corporation engages in steelmaking and steel fabrication, engineering and construction, chemicals and materials, and system solutions businesses in Japan and internationally. The company offers steel plates, sheets, and slags; bar and rod materials; structural steel; pipes and tubes; titanium and stainless products; and railway, automotive, and machinery parts for applications in automotive, energy, infrastructure, and consumer electronics markets. It is also involved in construction; waste processing and recycling; supplying electricity, gas, and heat; and the provision of coal-based chemical products, petrochemicals, electronic materials, materials and components for semiconductors and electronic parts, carbon fiber, and composite products. In addition, the company offers computer systems engineering and consulting, IT-enabled outsourcing, and other services. The company was formerly known as Nippon Steel & Sumitomo Metal Corporation and changed its name to Nippon Steel Corporation in April 2019. The company was incorporated in 1950 and is headquartered in Tokyo, Japan.

About Salzgitter

Salzgitter AG, together with its subsidiaries, engages in steel and technology businesses worldwide. It operates through four segments: Steel Production, Steel Processing, Trading, and Technology. The Steel Production segment manufactures steel and special steels, such as hot-rolled wide strip, steel sheet, sections, tailored blanks, as well as scrap trading. The Steel Processing segment produces various high-grade heavy plates; and manufactures line pipes, HFI-welded tubes, and precision and stainless-steel tubes. The Trading segment operates a European sales network, as well as trading companies and agencies worldwide. The Technology segment engages in the provision of machinery and plants for the filling and packaging of beverages, as well as special machinery engineering for shoe manufacturing and elastomer production. The company also provides IT, facility management, logistics, automotive engineering, and research and development services, as well as supplies raw materials. The company was founded in 1858 and is headquartered in Salzgitter, Germany.