Gerdau (NYSE:GGB) vs. ThyssenKrupp (OTCMKTS:TYEKF) Head-To-Head Review

Gerdau (NYSE:GGB) and ThyssenKrupp (OTCMKTS:TYEKF) are both mid-cap basic materials companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, valuation, analyst recommendations, dividends, institutional ownership, risk and earnings.

Insider and Institutional Ownership

1.5% of Gerdau shares are held by institutional investors. 0.0% of Gerdau shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Volatility & Risk

Gerdau has a beta of 1.42, meaning that its share price is 42% more volatile than the S&P 500. Comparatively, ThyssenKrupp has a beta of 1.05, meaning that its share price is 5% more volatile than the S&P 500.

Profitability

This table compares Gerdau and ThyssenKrupp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Gerdau	4.81%	6.51%	4.29%
ThyssenKrupp	-2.34%	-7.71%	-2.73%

Earnings & Valuation

This table compares Gerdau and ThyssenKrupp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gerdau	$69.10 billion	0.10	$846.59 million	$0.29	12.43
ThyssenKrupp	$38.01 billion	N/A	-$1.63 billion	($1.42)	-7.70

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

Analyst Ratings

This is a breakdown of recent ratings and price targets for Gerdau and ThyssenKrupp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gerdau	1	2	1	0	2.00
ThyssenKrupp	0	0	0	0	0.00

Gerdau currently has a consensus target price of $3.80, indicating a potential upside of 5.41%. Given Gerdau’s stronger consensus rating and higher probable upside, equities analysts plainly believe Gerdau is more favorable than ThyssenKrupp.

Summary

Gerdau beats ThyssenKrupp on 13 of the 13 factors compared between the two stocks.

About Gerdau

Gerdau S.A., together with its subsidiaries, operates as a steel producer company. The company operates through Brazil Business, North America Business, South America Business, and Special Steel Business segments. It also provides semi-finished products, including billets, blooms, and slabs; common long rolled products, such as rebars, wire rods, merchant bars, light shapes, and profiles to the construction and manufacturing industries; drawn products comprising barbed and barbless fence wires, galvanized wires, fences, concrete reinforcing wire mesh, nails, and clamps for manufacturing, construction, and agricultural industries; and special steel products used in auto parts, light and heavy vehicles, and agricultural machinery, as well as in the oil and gas, wind energy, machinery and equipment, mining and rail, and other markets. In addition, the company offers flat products, such as hot-rolled steel coils and heavy plates; and resells flat steel products. Further, it operates mines that produce iron ore located in the Brazilian state of Minas Gerais. The company sells its products through independent distributors, direct sales from the mills, and its retail network. Gerdau S.A. was founded in 1901 and is based in São Paulo, Brazil.

About ThyssenKrupp

thyssenkrupp AG operates as an industrial and technology company in Germany and internationally. It operates through five segments: Automotive Technology, Decarbon Technologies, Materials Services, Steel Europe, and Marine Systems. The Automotive Technology segment offers components, systems, and automation solutions for vehicle manufacturing, such as axle assembly, body in white, camshafts and electric engine components, dampers, dies, springs and stabilizers, crankshafts and conrods, steering, and undercarriages. The Decarbon Technologies segment provides slewing bearings and rings, green ammonia and methanol, chemical and cement plants, high pressure processing, and refinery services, as well as green hydrogen. The Marine System segment manufactures submarines, naval services, and naval surface vessels. The Material Services segment offers 3D-printing/additive manufacturing, alloys, infrastructure project and services, industrial minerals, logistics services, metals, nonferrous metals, plastics, rolled steel, special ores, and stainless steel. The Steel Europe segment manufactures composite materials, electrical steel, hot strips, organic coated strips and sheet, packaging steel, precision steel strip, and sheet and coated products. thyssenkrupp AG was founded in 1811 and is headquartered in Essen, Germany.