Reliance Steel & Aluminum Co. (NYSE: RS) and Ryerson Holding Corporation (NYSE:RYI) are both industrial products companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, earnings, institutional ownership, profitability and dividends.
Risk & Volatility
Reliance Steel & Aluminum Co. has a beta of 1.23, meaning that its share price is 23% more volatile than the S&P 500. Comparatively, Ryerson Holding Corporation has a beta of 2.11, meaning that its share price is 111% more volatile than the S&P 500.
This is a breakdown of recent ratings and target prices for Reliance Steel & Aluminum Co. and Ryerson Holding Corporation, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Reliance Steel & Aluminum Co.||0||3||6||0||2.67|
|Ryerson Holding Corporation||0||2||2||0||2.50|
Reliance Steel & Aluminum Co. currently has a consensus target price of $81.17, suggesting a potential upside of 17.11%. Ryerson Holding Corporation has a consensus target price of $15.25, suggesting a potential upside of 91.82%. Given Ryerson Holding Corporation’s higher probable upside, analysts clearly believe Ryerson Holding Corporation is more favorable than Reliance Steel & Aluminum Co..
Insider & Institutional Ownership
83.7% of Reliance Steel & Aluminum Co. shares are held by institutional investors. Comparatively, 39.7% of Ryerson Holding Corporation shares are held by institutional investors. 3.7% of Reliance Steel & Aluminum Co. shares are held by company insiders. Comparatively, 0.8% of Ryerson Holding Corporation shares are held by company 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.
This table compares Reliance Steel & Aluminum Co. and Ryerson Holding Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Reliance Steel & Aluminum Co.||3.57%||8.67%||4.82%|
|Ryerson Holding Corporation||0.48%||-53.49%||1.09%|
Valuation and Earnings
This table compares Reliance Steel & Aluminum Co. and Ryerson Holding Corporation’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Reliance Steel & Aluminum Co.||$9.14 billion||0.55||$853.70 million||$4.44||15.61|
|Ryerson Holding Corporation||$3.11 billion||0.10||$155.90 million||$0.42||18.93|
Reliance Steel & Aluminum Co. has higher revenue and earnings than Ryerson Holding Corporation. Reliance Steel & Aluminum Co. is trading at a lower price-to-earnings ratio than Ryerson Holding Corporation, indicating that it is currently the more affordable of the two stocks.
Reliance Steel & Aluminum Co. pays an annual dividend of $1.80 per share and has a dividend yield of 2.6%. Ryerson Holding Corporation does not pay a dividend. Reliance Steel & Aluminum Co. pays out 40.5% of its earnings in the form of a dividend. Ryerson Holding Corporation has raised its dividend for 6 consecutive years.
Reliance Steel & Aluminum Co. beats Ryerson Holding Corporation on 12 of the 17 factors compared between the two stocks.
Reliance Steel & Aluminum Co. Company Profile
Reliance Steel & Aluminum Co. is a metals service center company in North America (the United States and Canada). As of December 31, 2016, the Company’s network of metals service centers operated over 300 locations in 39 states in the United States and in 12 other countries (Australia, Belgium, Canada, China, France, Malaysia, Mexico, Singapore, South Korea, Turkey, the United Arab Emirates and the United Kingdom). As of December 31, 2016, it provided metals processing services and distributes a range of more than 100,000 metal products, including alloy, aluminum, brass, copper, carbon steel, stainless steel, titanium and specialty steel products in a range of industries. Its various metals service centers process and distribute only specialty metals. It delivers a range of products from facilities located across the United States and Canada. It provides a range of processing services for its customers’ and delivers products to fabricators, manufacturers and other end users.
Ryerson Holding Corporation Company Profile
Ryerson Holding Corporation is a service center company for carbon and stainless steel, as well as aluminum. The Company operates through metal service centers segment. In addition to providing a range of flat and long metals products, it offers various value-added processing and fabrication services, such as sawing, slitting, blanking, cutting to length, leveling, flame cutting, laser cutting, edge trimming, edge rolling, roll forming, tube manufacturing, polishing, shearing, forming, stamping, punching, rolling shell plate to radius and beveling to process materials to a specified thickness, length, width, shape and surface quality pursuant to specific customer orders. Its services include just-in-time inventory programs, production of kits containing multiple products for ease of assembly by the customer, consignment arrangements and the placement of its employees at a customer’s site for inventory management, and production and technical assistance.
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