Ryerson (NYSE:RYZ) vs. GATX (NYSE:GATX) Head to Head Contrast

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

Dividends

Ryerson pays an annual dividend of $0.75 per share and has a dividend yield of 2.7%. GATX pays an annual dividend of $2.64 per share and has a dividend yield of 1.6%. Ryerson pays out -60.5% of its earnings in the form of a dividend. GATX pays out 26.1% 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. GATX has increased its dividend for 15 consecutive years. Ryerson is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

94.8% of Ryerson shares are owned by institutional investors. Comparatively, 93.1% of GATX shares are owned by institutional investors. 6.6% of Ryerson shares are owned by company insiders. Comparatively, 1.9% of GATX shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Ryerson and GATX, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ryerson	1	2	0	0	1.67
GATX	0	0	4	0	3.00

GATX has a consensus target price of $219.33, suggesting a potential upside of 30.69%. Given GATX’s stronger consensus rating and higher possible upside, analysts plainly believe GATX is more favorable than Ryerson.

Earnings & Valuation

This table compares Ryerson and GATX”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ryerson	$4.57 billion	0.32	-$56.40 million	($1.24)	-22.67
GATX	$1.74 billion	3.40	$333.30 million	$10.10	16.62

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

Volatility and Risk

Ryerson has a beta of 1.59, suggesting that its share price is 59% more volatile than the S&P 500. Comparatively, GATX has a beta of 1.19, suggesting that its share price is 19% more volatile than the S&P 500.

Profitability

This table compares Ryerson and GATX’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%
GATX	17.94%	10.43%	2.12%

Summary

GATX beats Ryerson on 10 of the 16 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 GATX

GATX Corporation, together its subsidiaries, operates as railcar leasing company in the United States, Canada, Mexico, Europe, and India. It operates through three segments: Rail North America, Rail International, and Portfolio Management. The company leases tank and freight railcars, and locomotives for petroleum, chemical, food/agriculture, and transportation industries. It also offers maintenance services, including the interior cleaning of railcars, routine maintenance and repair of car body and safety appliances, regulatory compliance works, wheelset replacements, interior blast and lining, exterior blast and painting, and car stenciling services. In addition, the company manufactures commercial aircraft jet engines and leases aircraft spare engines; and owns and manages tank containers that are leased to chemical, industrial gas, energy, food, cryogenic and pharmaceutical industries, and tank container operators, as well as provides tank container sourcing, remarketing, and inspection and maintenance services. As of December 31, 2023, it owned and operated a fleet of approximately 148,500 railcars; 493 four-axle and 30 six-axle locomotives; 399 aircraft spare engines; and 23,931 tank containers. GATX Corporation was founded in 1898 and is headquartered in Chicago, Illinois.