Cleveland-Cliffs (NYSE:CLF – Get Free Report) and Outokumpu (OTCMKTS:OUTKY – Get Free Report) 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, analyst recommendations, risk, institutional ownership, dividends, valuation and earnings.
Analyst Recommendations
This is a breakdown of current ratings and price targets for Cleveland-Cliffs and Outokumpu, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Cleveland-Cliffs | 2 | 7 | 1 | 0 | 1.90 |
| Outokumpu | 1 | 4 | 1 | 0 | 2.00 |
Cleveland-Cliffs presently has a consensus price target of $11.77, indicating a potential upside of 6.69%. Given Cleveland-Cliffs’ higher possible upside, equities analysts plainly believe Cleveland-Cliffs is more favorable than Outokumpu.
Risk & Volatility
Insider & Institutional Ownership
67.7% of Cleveland-Cliffs shares are held by institutional investors. 1.0% of Cleveland-Cliffs shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Earnings and Valuation
This table compares Cleveland-Cliffs and Outokumpu”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Cleveland-Cliffs | $18.61 billion | 0.34 | -$1.48 billion | ($2.34) | -4.71 |
| Outokumpu | $6.19 billion | 0.53 | -$155.00 million | ($0.16) | -21.54 |
Outokumpu has lower revenue, but higher earnings than Cleveland-Cliffs. Outokumpu is trading at a lower price-to-earnings ratio than Cleveland-Cliffs, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Cleveland-Cliffs and Outokumpu’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Cleveland-Cliffs | -6.42% | -15.48% | -4.61% |
| Outokumpu | -2.55% | -4.00% | -2.43% |
Summary
Outokumpu beats Cleveland-Cliffs on 7 of the 13 factors compared between the two stocks.
About Cleveland-Cliffs
Cleveland-Cliffs is the largest flat-rolled steel company and the largest iron ore pellet producer in North America. The company is vertically integrated from mining through iron making, steelmaking, rolling, finishing and downstream with hot and cold stamping of steel parts and components. The company was formerly known as Cliffs Natural Resources Inc. and changed its name to Cleveland-Cliffs Inc. in August 2017. Cleveland-Cliffs Inc. was founded in 1847 and is headquartered in Cleveland, Ohio.
About Outokumpu
Outokumpu Oyj produces and sells various stainless steel products in Finland, other European countries, North America, the Asia-Pacific, and internationally. The company operates through three segments: Europe, Americas, and Ferrochrome. It offers cold rolled coils, strips, and sheets; hot rolled coils, strips, and plates; quarto plates; precision strips; and specialized components, such as welded stainless-steel I-beams, H-beams, hollow-section tubes, bent profiles, structural sections, hardened and customized press plates, suction roll shells, and blancs and disks. The company also provides stainless steel powder which includes Supra 316L, Dura 17-4PH, Ultra 904L, Therma 253MA, Dura 4116, and Ni-free austenitic stainless steel powder; and nickel-based alloys. Its products are used in various applications, including commercial kitchen, cooking, food industry, and home appliances; automotive and transportation; building and infrastructure; energy; marine; and heavy industries. The company was founded in 1910 and is headquartered in Helsinki, Finland.
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