Head-To-Head Analysis: Steel Dynamics (STLD) and L.B. Foster (FSTR)

Steel Dynamics (NASDAQ: STLD) and L.B. Foster (NASDAQ:FSTR) are both basic materials companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, analyst recommendations, valuation, dividends, risk, profitability and institutional ownership.

Profitability

This table compares Steel Dynamics and L.B. Foster’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Steel Dynamics 5.79% 21.45% 9.25%
L.B. Foster -7.38% -27.11% -9.27%

Earnings and Valuation

This table compares Steel Dynamics and L.B. Foster’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Steel Dynamics $7.78 billion 1.31 $382.11 million $2.17 19.88
L.B. Foster $483.51 million 0.58 -$141.66 million ($3.60) -7.54

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

Volatility and Risk

Steel Dynamics has a beta of 1.4, suggesting that its share price is 40% more volatile than the S&P 500. Comparatively, L.B. Foster has a beta of 2.32, suggesting that its share price is 132% more volatile than the S&P 500.

Dividends

Steel Dynamics pays an annual dividend of $0.62 per share and has a dividend yield of 1.4%. L.B. Foster does not pay a dividend. Steel Dynamics pays out 28.6% of its earnings in the form of a dividend.

Analyst Recommendations

This is a breakdown of recent ratings for Steel Dynamics and L.B. Foster, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Steel Dynamics 0 3 12 0 2.80
L.B. Foster 0 0 0 0 N/A

Steel Dynamics presently has a consensus target price of $42.21, indicating a potential downside of 2.12%. Given Steel Dynamics’ higher possible upside, research analysts clearly believe Steel Dynamics is more favorable than L.B. Foster.

Insider & Institutional Ownership

83.4% of Steel Dynamics shares are held by institutional investors. Comparatively, 71.5% of L.B. Foster shares are held by institutional investors. 4.2% of Steel Dynamics shares are held by company insiders. Comparatively, 20.3% of L.B. Foster shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

Steel Dynamics beats L.B. Foster on 11 of the 14 factors compared between the two stocks.

About Steel Dynamics

Steel Dynamics, Inc. is a steel producing and a metal recycling company. The Company is engaged in the manufacture and sale of steel products, processing and sale of recycled ferrous and nonferrous metals, and fabrication and sale of steel joists and deck products. Its segments include steel operations, metals recycling operations, steel fabrication operations and Other Operations. It offers a range of steel products, such as sheet products, long products and steel finishing. The steel operations segment includes Butler Flat Roll Division, Columbus Flat Roll Division, The Techs galvanizing lines, Structural and Rail Division, Engineered Bar Products Division, Roanoke Bar Division, Steel of West Virginia and Iron Dynamics. The metals recycling operations segment consists of OmniSource Corporation. The fabrication operations produce steel building components. The Other Operations segment consists of subsidiary operations and smaller joint ventures.

About L.B. Foster

L.B. Foster Company is a manufacturer, fabricator and distributor of products and services for the rail, construction, energy and utility markets. The Company’s segments include Rail Products and Services, Construction Products, and Tubular and Energy Services. Its Rail Products segment provides a range of new and used rail, trackwork and accessories to railroads, mines and industry. The Rail segment designs and produces concrete railroad ties, insulated rail joints, power rail, track fasteners, coverboards and special accessories for mass transit and other rail systems. The Construction Products segment sells and rents steel sheet piling, H-bearing pile and other piling products for foundation and earth retention requirements. The Tubular and Energy Services segment supplies pipe coatings for natural gas pipelines and utilities, blending, injection and metering equipment for the oil and gas market, and produces threaded pipe products for industrial water well and irrigation markets.

Receive News & Ratings for Steel Dynamics Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Steel Dynamics and related companies with MarketBeat.com's FREE daily email newsletter.

Latest News

Leave a Reply