Handy & Harman (NASDAQ: HNH) and Timkensteel Corp (NYSE:TMST) are both small-cap multi-sector conglomerates companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, earnings, analyst recommendations, institutional ownership, profitability, valuation and dividends.

Volatility and Risk

Handy & Harman has a beta of 1.4, suggesting that its stock price is 40% more volatile than the S&P 500. Comparatively, Timkensteel Corp has a beta of 2.3, suggesting that its stock price is 130% more volatile than the S&P 500.

Insider & Institutional Ownership

88.2% of Handy & Harman shares are held by institutional investors. Comparatively, 75.6% of Timkensteel Corp shares are held by institutional investors. 6.1% of Handy & Harman shares are held by insiders. Comparatively, 8.1% of Timkensteel Corp shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a summary of current ratings and target prices for Handy & Harman and Timkensteel Corp, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Handy & Harman 0 0 0 0 N/A
Timkensteel Corp 0 3 1 0 2.25

Timkensteel Corp has a consensus target price of $18.83, suggesting a potential upside of 12.44%. Given Timkensteel Corp’s higher probable upside, analysts plainly believe Timkensteel Corp is more favorable than Handy & Harman.

Profitability

This table compares Handy & Harman and Timkensteel Corp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Handy & Harman 0.91% 4.84% 1.01%
Timkensteel Corp 0.38% 0.88% 0.46%

Earnings & Valuation

This table compares Handy & Harman and Timkensteel Corp’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Handy & Harman $957.45 million 0.39 $110.27 million $0.71 42.61
Timkensteel Corp $1.08 billion 0.69 -$29.80 million ($1.99) -8.42

Handy & Harman has higher revenue, but lower earnings than Timkensteel Corp. Timkensteel Corp is trading at a lower price-to-earnings ratio than Handy & Harman, indicating that it is currently the more affordable of the two stocks.

About Handy & Harman

Handy & Harman Ltd. is a holding company. The Company, through its subsidiaries, is a diversified manufacturer of engineered industrial products. The Company’s segments include Joining Materials, Tubing, Building Materials, Performance Materials, Electrical Products, and Kasco Blades and Route Repair Services (Kasco). Joining Materials fabricates precious metals and their alloys into brazing alloys. Tubing manufactures a range of steel tubing products. Building Materials manufactures and supplies products to the commercial construction and building industries. Performance Materials manufactures sheet and mechanically formed glass manufactures sheet and mechanically formed glass, quartz, carbon and aramid materials. Electrical Products segment designs, manufactures and markets power electronics and power protection, among others. Kasco provides meat-room blade products, repair services and resale products for the meat and deli departments of supermarkets and restaurants, among others.

About Timkensteel Corp

TimkenSteel Corporation manufactures alloy steel, as well as carbon and micro-alloy steel. The Company’s portfolio includes special bar quality (SBQ) bars, seamless mechanical tubing and precision steel components. In addition, the Company supplies machining and thermal treatment services, as well as manage raw material recycling programs, which are used as a feeder system for its melt operations. The Company’s products include SBQ Steel and Seamless Mechanical Steel Tubing, and Value-added Precision Products and Services. Its focus is on alloy steel. The Company manufactures carbon, micro-alloy and alloy steel, sold as ingots, bars and tubes. In addition to its customized steels, the Company also manufactures custom-make precision components. Its products and services are used in a range of demanding applications in the market sectors, such as oil and gas, industrial equipment, mining and power generation.

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