Head-To-Head Comparison: Olympic Steel (NASDAQ:ZEUS) vs. Gold Resource (NYSE:GORO)

Olympic Steel (NASDAQ:ZEUS) and Gold Resource (NYSE:GORO) are both small-cap materials companies, but which is the better stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, valuation, earnings, analyst recommendations, profitability and risk.

Profitability

This table compares Olympic Steel and Gold Resource’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Olympic Steel	0.73%	2.11%	1.14%
Gold Resource	-61.31%	-35.25%	-16.15%

Analyst Recommendations

This is a summary of recent ratings for Olympic Steel and Gold Resource, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Olympic Steel	0	1	0	0	2.00
Gold Resource	0	1	1	0	2.50

Gold Resource has a consensus target price of $1.75, indicating a potential downside of 50.42%. Given Gold Resource’s stronger consensus rating and higher possible upside, analysts clearly believe Gold Resource is more favorable than Olympic Steel.

Dividends

Olympic Steel pays an annual dividend of $0.64 per share and has a dividend yield of 1.3%. Gold Resource pays an annual dividend of $0.04 per share and has a dividend yield of 1.1%. Olympic Steel pays out 54.7% of its earnings in the form of a dividend. Gold Resource pays out 80.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Olympic Steel has increased its dividend for 4 consecutive years. Olympic Steel is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider and Institutional Ownership

87.1% of Olympic Steel shares are owned by institutional investors. Comparatively, 18.4% of Gold Resource shares are owned by institutional investors. 13.8% of Olympic Steel shares are owned by company insiders. Comparatively, 1.3% of Gold Resource shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Olympic Steel and Gold Resource”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Olympic Steel	$1.90 billion	0.28	$22.98 million	$1.17	40.91
Gold Resource	$55.34 million	10.33	-$16.02 million	$0.05	70.60

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

Volatility and Risk

Olympic Steel has a beta of 1.75, indicating that its stock price is 75% more volatile than the S&P 500. Comparatively, Gold Resource has a beta of 1.06, indicating that its stock price is 6% more volatile than the S&P 500.

Summary

Olympic Steel beats Gold Resource on 13 of the 17 factors compared between the two stocks.

About Olympic Steel

Olympic Steel, Inc. processes, distributes, and stores metal products primarily in the United States, Canada, and Mexico. It operates in three segments: Carbon Flat Products; Specialty Metals Flat Products; and Tubular and Pipe Products. The company offers stainless steel and aluminum coil and sheet products, angles, rounds, and flat bars; alloy, heat treated, and abrasion resistant coils, sheets and plates; coated metals, including galvanized, galvannealed, electro galvanized, advanced high strength steels, aluminized, and automotive grades of steel; commercial quality, advanced high strength steel, drawing steel, and automotive grades cold rolled steel coil and sheet products; hot rolled carbon comprising hot rolled coil, pickled and oiled sheet and plate steel products, automotive grades, advanced high strength steels, and high strength low alloys; tube, pipe, and bar products, including round, square, and rectangular mechanical and structural tubing; hydraulic and stainless tubing; boiler tubing; carbon, stainless, and aluminum pipes; valves and fittings; and tin mill products, such as electrolytic tinplate, electrolytic chromium coated steel, and black plates. The company also provides cutting-to-length, slitting, shearing, blanking, tempering, stretcher-leveling, plate and laser processing, forming and machining, tube processing, finishing, and fabrication services, as well as value-added services, such as saw cutting, laser cutting, beveling, threading, and grooving services. It serves metal consuming industries, such as manufacturers and fabricators of transportation and material handling lift equipment, construction, mining and farm equipment, agriculture equipment, storage tanks, environmental and energy generation equipment, automobiles, food service, and electrical equipment, as well as general and plate fabricators, and metals service centers through direct sales force. Olympic Steel, Inc. was founded in 1954 and is based in Highland Hills, Ohio.

About Gold Resource

Gold Resource Corporation engages in the exploration, development, and production of gold and silver projects in Mexico and the United States. The company also explores for copper, lead, and zinc deposits. Its principal assets are the 100% owned Don David gold mine and Back Forty project covering approximately 1,304 hectares located in Menominee county, Michigan. The company was incorporated in 1998 and is headquartered in Denver, Colorado.