Ferroglobe (NASDAQ:GSM) vs. ThyssenKrupp (OTCMKTS:TKAMY) Head-To-Head Survey

ThyssenKrupp (OTCMKTS:TKAMY) and Ferroglobe (NASDAQ:GSM) are both materials companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, valuation, analyst recommendations, earnings, risk and institutional ownership.

Volatility and Risk

ThyssenKrupp has a beta of 1.4, meaning that its share price is 40% more volatile than the S&P 500. Comparatively, Ferroglobe has a beta of 1, meaning that its share price has a similar volatility profile to the S&P 500.

Insider and Institutional Ownership

89.6% of Ferroglobe shares are owned by institutional investors. 13.1% of Ferroglobe shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Dividends

ThyssenKrupp pays an annual dividend of $0.11 per share and has a dividend yield of 0.6%. Ferroglobe pays an annual dividend of $0.06 per share and has a dividend yield of 1.4%. ThyssenKrupp pays out 20.4% of its earnings in the form of a dividend. Ferroglobe pays out -27.3% 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. Ferroglobe has raised its dividend for 1 consecutive years. Ferroglobe is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Earnings & Valuation

This table compares ThyssenKrupp and Ferroglobe”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ThyssenKrupp	$36.31 billion	0.31	$514.57 million	$0.54	33.02
Ferroglobe	$1.34 billion	0.60	-$170.70 million	($0.22)	-19.45

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

Analyst Recommendations

This is a breakdown of current ratings and target prices for ThyssenKrupp and Ferroglobe, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ThyssenKrupp	2	2	3	1	2.38
Ferroglobe	1	1	1	0	2.00

Ferroglobe has a consensus target price of $6.00, suggesting a potential upside of 40.19%. Given Ferroglobe’s higher probable upside, analysts plainly believe Ferroglobe is more favorable than ThyssenKrupp.

Profitability

This table compares ThyssenKrupp and Ferroglobe’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ThyssenKrupp	0.89%	5.94%	2.17%
Ferroglobe	-2.96%	-3.73%	-1.78%

Summary

ThyssenKrupp beats Ferroglobe on 11 of the 18 factors compared between the two stocks.

About ThyssenKrupp

thyssenkrupp AG operates as an industrial and technology company in Germany and internationally. It operates through five segments: Automotive Technology, Decarbon Technologies, Materials Services, Steel Europe, and Marine Systems. The Automotive Technology segment offers components, systems, and automation solutions for vehicle manufacturing, such as axle assembly, body in white, camshafts and electric engine components, dampers, dies, springs and stabilizers, crankshafts and conrods, steering, and undercarriages. The Decarbon Technologies segment provides slewing bearings and rings, green ammonia and methanol, chemical and cement plants, high pressure processing, and refinery services, as well as green hydrogen. The Marine System segment manufactures submarines, naval services, and naval surface vessels. The Material Services segment offers 3D-printing/additive manufacturing, alloys, infrastructure project and services, industrial minerals, logistics services, metals, nonferrous metals, plastics, rolled steel, special ores, and stainless steel. The Steel Europe segment manufactures composite materials, electrical steel, hot strips, organic coated strips and sheet, packaging steel, precision steel strip, and sheet and coated products. thyssenkrupp AG was founded in 1811 and is headquartered in Essen, Germany.

About Ferroglobe

Ferroglobe PLC produces and sells silicon metal, and silicon and manganese-based ferroalloys in the United States, Europe, and internationally. It provides silicone chemicals that are used in a range of applications, including personal care items, construction-related products, health care products, and electronics; and silicon metal for primary and secondary aluminum producers. The company also offers silicomanganese, which is used as deoxidizing agent in the steel manufacturing process; and ferromanganese that is used as a deoxidizing, desulphurizing, and degassing agent in the removal of nitrogen and other harmful elements from steel. In addition, it offers ferrosilicon products that are used to produce stainless steel, carbon steel, and various other steel alloys, as well as to manufacture electrodes and aluminum; calcium silicon, which is used in the deoxidation and desulfurization of liquid steel, and production of coatings for cast iron pipes, as well as in the welding process of powder metal and in pyrotechnics; and nodularizers and inoculants, which are used in the production of iron. Further, the company provides silica fume, a by-product of the electrometallurgical process of silicon metal and ferrosilicon. Additionally, it operates quartz mines in South Africa, Spain, the United States, and Canada; and low-ash metallurgical coal mines in the United States; and a charcoal production facility in South Africa, as well as holds interests in hydroelectric power plant in France. The company serves silicone chemical producers; aluminum and steel manufacturers; auto companies and their suppliers; ductile iron foundries; manufacturers of photovoltaic solar cells and computer chips; and concrete producers. Ferroglobe PLC was formerly known as VeloNewco Limited and changed its name to Ferroglobe PLC in December 2015. The company was incorporated in 2015 and is headquartered in London, the United Kingdom.