Comparing Nippon Steel (OTCMKTS:NPSCY) and Friedman Industries (OTCMKTS:FRD)

Nippon Steel (OTCMKTS:NPSCY) and Friedman Industries (NYSE:FRD) are both basic materials companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, profitability, analyst recommendations, dividends, valuation, earnings and risk.

Institutional & Insider Ownership

0.0% of Nippon Steel shares are owned by institutional investors. Comparatively, 34.0% of Friedman Industries shares are owned by institutional investors. 2.8% of Friedman Industries shares are owned by company 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 Ratings

This is a summary of current ratings and target prices for Nippon Steel and Friedman Industries, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nippon Steel 0 0 1 0 3.00
Friedman Industries 0 0 0 0 N/A

Profitability

This table compares Nippon Steel and Friedman Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nippon Steel -9.12% -15.94% -6.60%
Friedman Industries -5.06% -4.20% -3.65%

Volatility & Risk

Nippon Steel has a beta of 1.14, indicating that its share price is 14% more volatile than the S&P 500. Comparatively, Friedman Industries has a beta of 0.7, indicating that its share price is 30% less volatile than the S&P 500.

Valuation & Earnings

This table compares Nippon Steel and Friedman Industries’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nippon Steel $54.48 billion 0.18 -$3.97 billion N/A N/A
Friedman Industries $142.10 million 0.30 -$5.25 million N/A N/A

Friedman Industries has lower revenue, but higher earnings than Nippon Steel.

Summary

Friedman Industries beats Nippon Steel on 7 of the 11 factors compared between the two stocks.

Nippon Steel Company Profile

Nippon Steel Corporation, together with its subsidiaries, engages in steelmaking and steel fabrication, engineering and construction, chemicals and materials, and system solutions businesses in Japan and internationally. The Steelmaking and Steel Fabrication segment offers steel plates and sheets; bars, beams, shapes, and rods; pipes and tubes; railway, automotive, and machinery parts; and stainless steel and titanium. The Engineering and Construction segment plans, designs, and constructs various construction projects, including industrial plants, environmental and energy plants, civil engineering projects, and large steel structures, such as skyscrapers and oil and gas pipelines. This segment also involved in the manufacturing and sale of industrial machinery, and equipment and steel structures; and waste processing and recycling, and supplying of electricity, gas, and heat. The Chemicals and Materials segment produces and sells various materials, including coal-based chemical products, petrochemicals, electronic materials, and components for semiconductors and electronic parts, carbon fiber, and composite products, as well as products that apply technologies for metal processing. The System Solutions segment provides computer system engineering and consulting services, information technology outsourcing services, and other client-oriented information technology business solutions to customers in manufacturing and consumer products industries. The company serves automotive, energy and resources, construction, appliance, machinery, equipment, and transportation industries. The company was formerly known as Nippon Steel & Sumitomo Metal Corporation and changed its name to Nippon Steel Corporation in April 2019. Nippon Steel Corporation was founded in 1949 and is based in Tokyo, Japan.

Friedman Industries Company Profile

Friedman Industries, Incorporated engages in steel processing, pipe manufacturing and processing, and the steel and pipe distribution businesses the United States. It operates in two segments, Coil and Tubular. The Coil segment is involved in the processing and wholesale of hot-roll coils into sheet and plate, as well as customer-owned coils. This segment offers its coil products and processing services primarily to steel distributors and customers manufacturing steel products, such as steel buildings, railroad cars, barges, tanks and containers, trailers, component parts, and other fabricated steel products through its own sales force. The Tubular segment manufactures line and oil country pipes, as well as pipes for structural applications. This segment sells its tubular products principally to steel and pipe distributors through its own sales force. The company was founded in 1965 and is headquartered in Longview, Texas.

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