FAT Brands (NASDAQ:FAT) and Norsk Hydro ASA (OTCMKTS:NHYDY) Critical Contrast

Norsk Hydro ASA (OTCMKTS:NHYDY) and FAT Brands (NASDAQ:FAT) are both materials companies, but which is the better stock? We will contrast the two companies based on the strength of their profitability, valuation, risk, analyst recommendations, institutional ownership, earnings and dividends.

Insider & Institutional Ownership

0.0% of Norsk Hydro ASA shares are owned by institutional investors. Comparatively, 6.9% of FAT Brands shares are owned by institutional investors. 0.0% of Norsk Hydro ASA shares are owned by company insiders. Comparatively, 15.7% of FAT Brands shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Norsk Hydro ASA and FAT Brands”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Norsk Hydro ASA	$20.05 billion	0.85	$647.52 million	$0.52	16.50
FAT Brands	$574.14 million	0.01	-$189.85 million	($13.35)	-0.01

Norsk Hydro ASA has higher revenue and earnings than FAT Brands. FAT Brands is trading at a lower price-to-earnings ratio than Norsk Hydro ASA, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Norsk Hydro ASA has a beta of 1.03, indicating that its share price is 3% more volatile than the S&P 500. Comparatively, FAT Brands has a beta of 1.34, indicating that its share price is 34% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Norsk Hydro ASA and FAT Brands, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Norsk Hydro ASA	1	8	2	1	2.25
FAT Brands	1	1	0	0	1.50

Dividends

Norsk Hydro ASA pays an annual dividend of $0.23 per share and has a dividend yield of 2.7%. FAT Brands pays an annual dividend of $0.14 per share and has a dividend yield of 86.1%. Norsk Hydro ASA pays out 44.2% of its earnings in the form of a dividend. FAT Brands pays out -1.0% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. FAT Brands is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Norsk Hydro ASA and FAT Brands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Norsk Hydro ASA	4.90%	11.46%	6.05%
FAT Brands	-39.33%	N/A	-17.99%

Summary

Norsk Hydro ASA beats FAT Brands on 11 of the 16 factors compared between the two stocks.

About Norsk Hydro ASA

Norsk Hydro ASA engages in the power production, bauxite extraction, alumina refining, aluminium smelting, and recycling activities; and provision of extruded solutions worldwide. It operates through Hydro Bauxite & Alumina, Hydro Aluminium Metal, Hydro Metal Markets, Hydro Extrusions, and Hydro Energy segments. The Hydro Bauxite & Alumina segment engages in bauxite mining activities, production of alumina, and related commercial activities, primarily the sale of alumina. The Hydro Aluminium Metal segment is involved in the primary aluminum production casting activities. This segment principally offers extrusion ingots, foundry alloys, and sheet and standard ingots. The Metal Markets segment sells products from the company’s primary metal plants; operates recyclers; and trades in physical and financial metals. The Hydro Extrusions segment offers extrusion profiles, building systems, and precision tubing products for construction, automotive and heating, and ventilation and air conditioning sectors, as well as operates recycling facilities. The Hydro Energy segment engages in the trading and wholesale business in Brazil; energy sourcing operations; and operation of power stations in Norway, as well as renewable energy production, such as wind and solar, battery materials, and green hydrogen. Norsk Hydro ASA was founded in 1905 and is headquartered in Oslo, Norway.

About FAT Brands

FAT Brands Inc., a multi-brand restaurant franchising company, acquires, develops, markets, and manages quick service, fast casual, casual dining, and polished casual dining restaurant concepts worldwide. It owns restaurant brands, including Round Table Pizza, Marble Slab Creamery, Great American Cookies, Hot Dog on a Stick, Pretzelmaker, Fazoli's, Fatburger, Johnny Rockets, Elevation Burger, Yalla Mediterranean, Buffalo's Cafe and Buffalo's Express, Hurricane Grill & Wings, Ponderosa Steakhouse/Bonanza Steakhouse, Native Grill & Wings, Smokey Bones, and Twin Peaks. The company was incorporated in 2017 and is headquartered in Beverly Hills, California. FAT Brands Inc. is a subsidiary of Fog Cutter Holdings, LLC.