Critical Comparison: Handy & Harman (HNH) and AK Steel Holding Corporation (AKS)
Handy & Harman (NASDAQ: HNH) and AK Steel Holding Corporation (NYSE:AKS) are both small-cap basic materials companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, profitability, valuation, risk and earnings.
This is a summary of current recommendations for Handy & Harman and AK Steel Holding Corporation, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Handy & Harman||0||0||0||0||N/A|
|AK Steel Holding Corporation||0||10||4||0||2.29|
AK Steel Holding Corporation has a consensus price target of $7.75, indicating a potential upside of 68.83%. Given AK Steel Holding Corporation’s higher possible upside, analysts clearly believe AK Steel Holding Corporation is more favorable than Handy & Harman.
This table compares Handy & Harman and AK Steel Holding Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Handy & Harman||5.07%||27.77%||6.04%|
|AK Steel Holding Corporation||0.92%||140.37%||4.97%|
Valuation and Earnings
This table compares Handy & Harman and AK Steel Holding Corporation’s top-line revenue, earnings per share (EPS) 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||42.68|
|AK Steel Holding Corporation||$5.96 billion||0.24||$718.20 million||$0.14||32.79|
AK Steel Holding Corporation has higher revenue and earnings than Handy & Harman. AK Steel Holding Corporation is trading at a lower price-to-earnings ratio than Handy & Harman, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Handy & Harman has a beta of 1.4, indicating that its stock price is 40% more volatile than the S&P 500. Comparatively, AK Steel Holding Corporation has a beta of 2.94, indicating that its stock price is 194% more volatile than the S&P 500.
Institutional & Insider Ownership
88.2% of Handy & Harman shares are owned by institutional investors. Comparatively, 70.7% of AK Steel Holding Corporation shares are owned by institutional investors. 6.1% of Handy & Harman shares are owned by company insiders. Comparatively, 0.8% of AK Steel Holding Corporation shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Handy & Harman beats AK Steel Holding Corporation on 7 of the 13 factors compared between the two stocks.
Handy & Harman Company Profile
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.
AK Steel Holding Corporation Company Profile
AK Steel Holding Corporation is a producer of flat-rolled carbon, stainless and electrical steels, and tubular products through its subsidiary, AK Steel Corporation (AK Steel). The Company also operates blast furnaces and electric arc furnaces. As of December 31, 2016, its operations included eight steelmaking and finishing plants, two coke plants and two tube manufacturing plants across states, including Indiana, Kentucky, Michigan, Ohio, Pennsylvania and West Virginia, and a tube manufacturing plant in Mexico. These operations produce flat-rolled carbon, specialty stainless and electrical steels that it sells in sheet and strip form, and carbon and stainless steel that it finishes into welded steel tubing. It also produces metallurgical coal through its subsidiary, AK Coal Resources, Inc. In addition, the Company operates trading companies in Mexico and Europe that buy and sell steel and steel products and other materials.
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