Analyzing Finning International (OTCMKTS:FINGF) and Ryerson (NYSE:RYZ)

Ryerson (NYSE:RYZ) and Finning International (OTCMKTS:FINGF) are both industrials companies, but which is the superior stock? We will compare the two businesses based on the strength of their valuation, institutional ownership, profitability, analyst recommendations, earnings, dividends and risk.

Analyst Recommendations

This is a summary of current ratings and price targets for Ryerson and Finning International, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ryerson	1	2	0	0	1.67
Finning International	0	0	5	0	3.00

Earnings & Valuation

This table compares Ryerson and Finning International”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ryerson	$4.57 billion	0.29	-$56.40 million	($1.24)	-20.72
Finning International	$7.58 billion	1.17	$470.93 million	$2.34	29.07

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

Dividends

Ryerson pays an annual dividend of $0.75 per share and has a dividend yield of 2.9%. Finning International pays an annual dividend of $0.93 per share and has a dividend yield of 1.4%. Ryerson pays out -60.5% of its earnings in the form of a dividend. Finning International pays out 39.7% 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. Ryerson is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

94.8% of Ryerson shares are owned by institutional investors. 6.6% of Ryerson shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Ryerson and Finning International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ryerson	-0.56%	-0.62%	-0.21%
Finning International	4.93%	20.17%	7.06%

Summary

Finning International beats Ryerson on 10 of the 14 factors compared between the two stocks.

About Ryerson

Ryerson Holding Corporation, together with its subsidiaries, processes and distributes industrial metals in the United States, Canada, Mexico, and China. It offers a line of products in carbon steel, stainless steel, alloy steels, and aluminum, as well as nickel and red metals in various shapes and forms, including coils, sheets, rounds, hexagons, square and flat bars, plates, structural, and tubing. The company also provides various processing services, such as bending, beveling, blanking, blasting, burning, cutting-to-length, drilling, embossing, flattening, forming, grinding, laser cutting, machining, notching, painting, perforating, polishing, punching, rolling, sawing, scribing, shearing, slitting, stamping, tapping, threading, welding, or other techniques to process materials. It serves various industries, including commercial ground transportation, metal fabrication and machine shops, industrial machinery and equipment manufacturing, consumer durable equipment, HVAC manufacturing, construction equipment manufacturing, food processing and agricultural equipment manufacturing, and oil and gas. The company was founded in 1842 and is headquartered in Chicago, Illinois.

About Finning International

Finning International Inc. sells, services, and rents heavy equipment, engines, and related products in Canada, Chile, Bolivia, the United Kingdom, Argentina, Ireland, and internationally. The company offers articulated trucks, asphalt pavers, backhoe loaders, cold planers, compactors, dozers, drills, electric rope shovels, excavators, hydraulic mining shovels, material handlers, motor graders, off-highway trucks, pipelayers, road reclaimers, skid steer and compact track loaders, track loaders, underground-hard rock, wheel loaders, and wheel tractor-scrapers, as well as mobile and stationary generator sets. It also provides blades, buckets – skid steer loaders, forks, hammers, augers, brooms, material handling, mulchers, grapples, couplers loaders, backhoes, buckets telehandlers, trenchers, stump grinders, multi-processors, buckets loaders, electric power controls, rakes, couplers excavators, bale grabs, cold planers, compactors, flail mowers, buckets mining shovels, pulverizers, nursery products, buckets compact wheels loaders, buckets backhoe rears, bale spears, tillers, shears, buckets backhoe fronts, tilt rotate systems, adapters, rippers, saws, snow products, and buckets excavators. In addition, it offers power systems for electric power generation, oil and gas, industrial, and marine power systems; and rents generators, power distribution products, and air compressors. Further, the company provides aftercare, fluid analysis, finning managed, financing, warranty, customer training solutions, as well as rebuilds, rentals, and repair services. It serves agriculture, construction, forestry, electric power generation, industrial and waste, industrial OEMs, marine, mining, oil and gas, paving, and quarrying industries. The company was formerly known as Finning Ltd. and changed its name to Finning International Inc. in April 1997. Finning International Inc. was incorporated in 1933 and is headquartered in Surrey, Canada.