Head to Head Review: AK Steel (AKS) vs. Titan International (TWI)

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AK Steel (NYSE: TWI) and Titan International (NYSE:TWI) are both small-cap basic materials companies, but which is the better business? We will compare the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, analyst recommendations, valuation and dividends.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for AK Steel and Titan International, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
AK Steel 3 8 4 0 2.07
Titan International 0 2 0 0 2.00

AK Steel currently has a consensus price target of $5.44, suggesting a potential upside of 23.69%. Titan International has a consensus price target of $14.75, suggesting a potential upside of 98.25%. Given Titan International’s higher possible upside, analysts clearly believe Titan International is more favorable than AK Steel.

Risk and Volatility

AK Steel has a beta of 2.84, meaning that its share price is 184% more volatile than the S&P 500. Comparatively, Titan International has a beta of 1.62, meaning that its share price is 62% more volatile than the S&P 500.

Profitability

This table compares AK Steel and Titan International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
AK Steel -0.44% 33.56% 1.92%
Titan International -1.47% 3.38% 0.82%

Insider & Institutional Ownership

62.4% of AK Steel shares are owned by institutional investors. Comparatively, 91.7% of Titan International shares are owned by institutional investors. 1.1% of AK Steel shares are owned by insiders. Comparatively, 17.3% of Titan International 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.

Dividends

Titan International pays an annual dividend of $0.02 per share and has a dividend yield of 0.3%. AK Steel does not pay a dividend. Titan International pays out -4.1% of its earnings in the form of a dividend.

Earnings and Valuation

This table compares AK Steel and Titan International’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
AK Steel $6.08 billion 0.23 $6.19 million $0.31 14.19
Titan International $1.47 billion 0.30 -$60.04 million ($0.49) -15.18

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

Summary

AK Steel beats Titan International on 9 of the 15 factors compared between the two stocks.

About AK Steel

AK Steel Holding Corporation, through its subsidiary, AK Steel Corporation, produces flat-rolled carbon, stainless, and electrical steels, and tubular products in the United States and internationally. It produces flat-rolled carbon steel products, including coated, cold-rolled, and hot-rolled carbon steel products; grain-oriented specialty stainless and electrical steels; and carbon and stainless steel tubing products. The company also buys and sells steel and steel products, as well as other materials; and produces metallurgical coal from reserves in Somerset County, Pennsylvania. It sells its flat-rolled carbon steel products primarily to automotive manufacturers; customers in the infrastructure and manufacturing markets, including the manufacturers of power transmission and distribution transformers, who produce equipment for the electrical grid, as well as electrical motors and generators; and manufacturers of heating, ventilation and air conditioning equipment, and appliances. The company also sells its carbon steel products to distributors, service centers, and converters. AK Steel Holding Corporation was founded in 1993 and is headquartered in West Chester, Ohio.

About Titan International

Titan International, Inc., together with its subsidiaries, manufactures and sells wheels, tires, wheel and tire assemblies, and undercarriage systems and components for off-highway vehicles in the United States and internationally. It operates in three segments: Agricultural, Earthmoving/Construction, and Consumer. The company offers rims, wheels, tires, and undercarriage systems and components for various agricultural equipment, including tractors, combines, skidders, plows, planters, and irrigation equipment; and off-the-road earthmoving, mining, military, construction, and forestry equipment comprising skid steers, aerial lifts, cranes, graders and levelers, scrapers, self-propelled shovel loaders, articulated dump trucks, load transporters, haul trucks, backhoe loaders, crawler tractors, lattice cranes, shovels, and hydraulic excavators. It also provides bias and light truck tires; and products for all-terrain vehicles, turf, and golf cart applications, as well as high-speed brakes. The company sells its products directly to original equipment manufacturers, as well as to the aftermarket through independent distributors, equipment dealers, and own distribution centers. Titan International, Inc. was founded in 1890 and is based in Quincy, Illinois.

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