Financial Analysis: Steel Dynamics (NASDAQ:STLD) vs. Santacruz Silver Mining (NASDAQ:SCZM)

Santacruz Silver Mining (NASDAQ:SCZM) and Steel Dynamics (NASDAQ:STLD) are both materials companies, but which is the superior business? We will contrast the two businesses based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, risk, profitability and valuation.

Institutional & Insider Ownership

82.4% of Steel Dynamics shares are owned by institutional investors. 6.6% of Steel Dynamics shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent ratings and price targets for Santacruz Silver Mining and Steel Dynamics, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Santacruz Silver Mining	0	2	1	0	2.33
Steel Dynamics	0	4	9	0	2.69

Santacruz Silver Mining presently has a consensus price target of $10.00, indicating a potential upside of 30.04%. Steel Dynamics has a consensus price target of $275.17, indicating a potential upside of 14.60%. Given Santacruz Silver Mining’s higher possible upside, equities analysts plainly believe Santacruz Silver Mining is more favorable than Steel Dynamics.

Valuation & Earnings

This table compares Santacruz Silver Mining and Steel Dynamics”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Santacruz Silver Mining	$326.38 million	2.19	$42.22 million	$0.32	24.03
Steel Dynamics	$18.18 billion	1.88	$1.19 billion	$13.55	17.72

Steel Dynamics has higher revenue and earnings than Santacruz Silver Mining. Steel Dynamics is trading at a lower price-to-earnings ratio than Santacruz Silver Mining, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Santacruz Silver Mining and Steel Dynamics’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Santacruz Silver Mining	9.97%	21.55%	9.49%
Steel Dynamics	8.82%	21.57%	11.61%

Summary

Steel Dynamics beats Santacruz Silver Mining on 9 of the 12 factors compared between the two stocks.

About Santacruz Silver Mining

Santacruz Silver Mining Ltd., together with its subsidiaries, engages in the acquisition, exploration, development, and operation of mineral properties in Mexico. The company primarily explores for silver, as well as for gold, zinc, lead, and copper deposits. It primarily holds a 100% interest in the Rosario project located in the municipality of Charcas in the state of San Luis Potosi; and Veta Grande project that include three concession groups, which consists of 184 mining concessions covering an area of 8,944 hectares in the Zacatecas Mining District, Mexico. The company was formerly known as Forte Resources Inc. and changed its name to Santacruz Silver Mining Ltd. in April 2012. Santacruz Silver Mining Ltd. Was incorporated in 2011 and is based in Vancouver, Canada.

About Steel Dynamics

Steel Dynamics, Inc., together with its subsidiaries, operates as a steel producer and metal recycler in the United States. The Steel Operations segment offers hot rolled, cold rolled, and coated steel products; parallel flange beams and channel sections, flat bars, large unequal leg angles, and reinforcing steel bars, as well as standard strength carbon, intermediate alloy hardness, and premium grade rail products; engineered special-bar-quality products, merchant-bar-quality products, and other engineered round steel bars; channels, angles, flats, merchant rounds, and reinforcing steel bars; and specialty shapes and light structural steel products. This segment also engages in turning, polishing, straightening, chamfering, precision saw-cutting, and heat treating of bar products. Its products are used in construction, automotive, manufacturing, transportation, heavy and agriculture equipment, and pipe and tube markets. The Metals Recycling Operations segment is involved in the ferrous and nonferrous scrap metal processing, transportation, marketing, brokerage, and scrap management services. Its ferrous products include heavy melting steel, busheling, bundled scrap, shredded scrap, steel turnings, and cast-iron products; and nonferrous products comprise aluminum, brass, copper, stainless steel, and other nonferrous metals. The Steel Fabrication Operations segment produces steel non-residential building components, such as steel joists, girders, trusses, and steel deck products for non-residential steel fabricators, metal building companies, general construction contractors, developers, owners, brokers, and governmental entities, as well as e-commerce warehouses, data centers, metal buildings, and education and commercial building projects. The Aluminum Operations segment offers recycled aluminum flat rolled products. The company also exports its products. Steel Dynamics, Inc. was founded in 1993 and is headquartered in Fort Wayne, Indiana.