Financial Contrast: Ero Copper (NYSE:ERO) and Constellium (NYSE:CSTM)

Ero Copper (NYSE:ERO) and Constellium (NYSE:CSTM) are both mid-cap materials companies, but which is the better stock? We will compare the two companies based on the strength of their valuation, profitability, institutional ownership, earnings, dividends, risk and analyst recommendations.

Profitability

This table compares Ero Copper and Constellium’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ero Copper	29.79%	30.32%	15.17%
Constellium	5.69%	51.66%	9.63%

Earnings & Valuation

This table compares Ero Copper and Constellium”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ero Copper	$1.04 billion	3.28	$263.72 million	$2.98	11.01
Constellium	$8.45 billion	0.41	$273.00 million	$3.88	6.52

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

Volatility and Risk

Ero Copper has a beta of 1.27, suggesting that its share price is 27% more volatile than the S&P 500. Comparatively, Constellium has a beta of 1.55, suggesting that its share price is 55% more volatile than the S&P 500.

Institutional and Insider Ownership

71.3% of Ero Copper shares are owned by institutional investors. Comparatively, 92.6% of Constellium shares are owned by institutional investors. 1.2% of Constellium shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and target prices for Ero Copper and Constellium, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ero Copper	1	10	5	2	2.44
Constellium	0	2	4	1	2.86

Ero Copper presently has a consensus target price of $32.33, suggesting a potential downside of 1.47%. Constellium has a consensus target price of $35.80, suggesting a potential upside of 41.52%. Given Constellium’s stronger consensus rating and higher probable upside, analysts clearly believe Constellium is more favorable than Ero Copper.

Summary

Constellium beats Ero Copper on 9 of the 15 factors compared between the two stocks.

About Ero Copper

Ero Copper Corp. engages in the exploration, development, and production of mining projects in Brazil. The company is involved in the production and sale of copper concentrate from the Caraíba operations located in the Curaçá Valley, northeastern Bahia state, Brazil, as well as gold and silver by-products. It also holds 100% interests in the Tucumã project, a copper development project located within southeastern Pará state; and the Xavantina Operations located in Mato Grosso state. Ero Copper Corp. was incorporated in 2016 and is headquartered in Vancouver, Canada.

About Constellium

Constellium SE, together with its subsidiaries, engages in the design, manufacture, and sale of rolled and extruded aluminum products for the packaging, aerospace, automotive, defense, and other transportation and industry end-markets. The company operates through three segments: Packaging & Automotive Rolled Products, Aerospace & Transportation, and Automotive Structures & Industry. The Packaging & Automotive Rolled Products segment produces rolled aluminum products, including can stock and closure stock for the beverage and food industry, as well as foil stock for the flexible packaging market. This segment also supplies automotive body sheets and heat exchangers for the automotive market; and specialty reflective sheets. The Aerospace & Transportation segment provides rolled aluminum products, including aerospace plates, sheets, and extrusions; and aerospace wing skins, as well as plates and sheets for use in transportation, industry, and defense applications. The Automotive Structures & Industry segment offers extruded aluminium products and aluminium structural components for the automotive industry, including crash-management systems, body structures, side impact beams, and battery enclosures; and fabricates hard and soft alloy extruded profiles for various industry applications in the automotive, engineering, rail, and other transportation end markets. This segment also provides downstream technology and services, which include pre-machining, surface treatment, research and development, and technical support services. It sells its products directly or through distributors in France, Germany, the Czech Republic, the United Kingdom, Switzerland, and the United States, as well as Shanghai, and Seoul. The company was incorporated in 2010 and is headquartered in Paris, France.