Analyzing Universal Stainless & Alloy Products (USAP) and POSCO (PKX)

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Universal Stainless & Alloy Products (NYSE: PKX) and POSCO (NYSE:PKX) are both basic materials companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, analyst recommendations, earnings and risk.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Universal Stainless & Alloy Products and POSCO, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Universal Stainless & Alloy Products 0 1 1 0 2.50
POSCO 0 0 2 0 3.00

Universal Stainless & Alloy Products currently has a consensus target price of $33.00, suggesting a potential upside of 11.45%. Given Universal Stainless & Alloy Products’ higher probable upside, research analysts plainly believe Universal Stainless & Alloy Products is more favorable than POSCO.

Institutional and Insider Ownership

91.2% of Universal Stainless & Alloy Products shares are owned by institutional investors. Comparatively, 5.2% of POSCO shares are owned by institutional investors. 10.3% of Universal Stainless & Alloy Products shares are owned by company insiders. Comparatively, 0.0% of POSCO shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Universal Stainless & Alloy Products and POSCO’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Universal Stainless & Alloy Products $202.64 million 1.27 $7.61 million N/A N/A
POSCO $54.59 billion 0.47 $2.48 billion $7.75 9.54

POSCO has higher revenue and earnings than Universal Stainless & Alloy Products.

Risk and Volatility

Universal Stainless & Alloy Products has a beta of 1.22, meaning that its stock price is 22% more volatile than the S&P 500. Comparatively, POSCO has a beta of 1.25, meaning that its stock price is 25% more volatile than the S&P 500.

Dividends

POSCO pays an annual dividend of $1.07 per share and has a dividend yield of 1.4%. Universal Stainless & Alloy Products does not pay a dividend. POSCO pays out 13.8% of its earnings in the form of a dividend.

Profitability

This table compares Universal Stainless & Alloy Products and POSCO’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Universal Stainless & Alloy Products 6.43% 2.92% 1.77%
POSCO 4.76% 6.03% 3.58%

Summary

POSCO beats Universal Stainless & Alloy Products on 8 of the 15 factors compared between the two stocks.

About Universal Stainless & Alloy Products

Universal Stainless & Alloy Products, Inc., together with its subsidiaries, manufactures and markets semi-finished and finished specialty steel products in the United States and internationally. The company's products include stainless steel, nickel alloys, tool steel, and various other alloyed steels. The company offers semi-finished and finished long products in the form of ingots, blooms, billets, and bars; flat rolled products, such as slabs and plates; and customized shapes primarily for original equipment manufacturers (OEMs), which are cold rolled from purchased coiled strip, flat bar, or extruded bar. Its semi-finished long products are primarily used to produce finished bar, rod, and wire products; and finished bar products that are principally used by OEMs and by service center customers for distribution to various end users. The company also offers conversion services on materials supplied by its customers. Its products are also used in aerospace, oil and gas, power generation, and automotive industries, as well as in the manufacturing of equipment for food handling, health and medical, chemical processing, and pollution control; and manufacturing of metals, plastics, paper and aluminum extrusions, pharmaceuticals, electronics, and optics. Universal Stainless & Alloy Products, Inc. sells its products to service centers, forgers, rerollers, OEMs, and wire redrawers. The company was founded in 1994 and is headquartered in Bridgeville, Pennsylvania.

About POSCO

POSCO manufactures and sells steel rolled products and plates in South Korea and internationally. It operates through four segments: Steel, Construction, Trading, and Others. The company offers hot and cold rolled steel, steel plates, wire rods, galvanized and electrical galvanized steel, electrical and stainless steel, automotive materials, titanium, magnesium, and aluminum-plated products. It also designs and constructs industrial plants, civil engineering projects, and commercial and residential buildings; exports and imports steel products and raw materials; and produces liquefied natural gas, power, and refuse derived fuel, as well as provides network and system integration, and logistics services. In addition, the company engages in the engineering and construction; coated steel, zinc relief, and components manufacturing; computer hardware and software distribution; economic research and consulting; business facility maintenance; architecture and consulting; investment in venture, energy, and bio tech companies; electronic commerce; refractories and quicklime manufacturing and sales; transporting and warehousing; real estate rental and sale; house and train manufacturing and management; education and real estate business; hotel; and stem cell medicine development activities. Further, it engages in the non-residential building rental; secondary and storage battery and textile manufacturing; resource development; iron ore and coal sales; and mine development. Additionally, the company engages in loading and unloading; IT service and DVR; electric control engineering; forest resources development; human resource; wastewater treatment operation and maintenance; crude oil and natural gas mining; refractory materials sales and furnace maintenance; rice processing; grain sales; petroleum gas extraction; private equity trust; packing materials manufacturing; and social enterprise businesses. POSCO was founded in 1968 and is headquartered in Pohang, South Korea.

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