Allegheny Technologies (NYSE: ATI) and Rio Tinto plc (NYSE:RTP) are both basic materials companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, dividends, profitability, risk, earnings, analyst recommendations and institutional ownership.

Dividends

Allegheny Technologies pays an annual dividend of $0.08 per share and has a dividend yield of 0.4%. Rio Tinto plc does not pay a dividend. Allegheny Technologies pays out -1.7% of its earnings in the form of a dividend.

Insider & Institutional Ownership

96.6% of Allegheny Technologies shares are owned by institutional investors. 1.1% of Allegheny Technologies shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Allegheny Technologies and Rio Tinto plc’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Allegheny Technologies $3.31 billion 0.59 $295.80 million ($4.61) -3.88
Rio Tinto plc N/A N/A N/A N/A N/A

Allegheny Technologies has higher revenue and earnings than Rio Tinto plc.

Profitability

This table compares Allegheny Technologies and Rio Tinto plc’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Allegheny Technologies -14.89% 0.08% 0.02%
Rio Tinto plc 17.01% 16.16% 7.28%

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Allegheny Technologies and Rio Tinto plc, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Allegheny Technologies 1 4 3 0 2.25
Rio Tinto plc 0 0 0 0 N/A

Allegheny Technologies currently has a consensus target price of $19.65, indicating a potential upside of 9.84%.

Summary

Allegheny Technologies beats Rio Tinto plc on 6 of the 9 factors compared between the two stocks.

Allegheny Technologies Company Profile

Allegheny Technologies Incorporated is a manufacturer of specialty materials and complex components. The Company operates through two business segments: High Performance Materials & Components (HPMC), and Flat Rolled Products (FRP). The HPMC segment produces, converts and distributes a range of materials, including titanium and titanium-based alloys, nickel- and cobalt-based alloys and superalloys, zirconium and related alloys, including hafnium and niobium, advanced powder alloys and other specialty materials, in long product forms, such as ingot, billet, bar, rod, wire, shapes and rectangles, and seamless tubes, plus precision forgings, castings, components and machined parts. The FRP segment produces, converts and distributes stainless steel, nickel-based alloys, specialty alloys, and titanium and titanium-based alloys, in a range of product forms, including plate, sheet, engineered strip, and Precision Rolled Strip products.

Rio Tinto plc Company Profile

Rio Tinto plc is a mining and metals company. The Company’s business is finding, mining and processing mineral resources. The Company’s segments include Iron Ore, Aluminium, Copper & Diamonds, Energy & Minerals and Other Operations. The Company operates an iron ore business, supplying the global seaborne iron ore trade. Its Iron Ore product operations are located in the Pilbara region of Western Australia. The Aluminium business includes bauxite mines, alumina refineries and aluminum smelters. Its bauxite mines are located in Australia, Brazil and Guinea. The Copper & Diamonds segment has managed operations in Australia, Canada, Mongolia and the United States, and non-managed operations in Chile and Indonesia. The Energy & Minerals segment consists of mining, refining and marketing operations in over 10 countries, across six sectors: borates, coal, iron ore concentrate and pellets, salt, titanium dioxide and uranium.

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