Nucor (NYSE: NUE) and SunCoke Energy (NYSE:SXC) are both basic materials companies, but which is the better stock? We will compare the two companies based on the strength of their earnings, risk, analyst recommendations, profitability, institutional ownership, dividends and valuation.

Profitability

This table compares Nucor and SunCoke Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nucor 5.80% 12.78% 6.87%
SunCoke Energy 0.42% 4.60% 1.21%

Dividends

Nucor pays an annual dividend of $1.51 per share and has a dividend yield of 2.4%. SunCoke Energy does not pay a dividend. Nucor pays out 43.9% of its earnings in the form of a dividend. Nucor has increased its dividend for 2 consecutive years and SunCoke Energy has increased its dividend for 43 consecutive years.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Nucor and SunCoke Energy, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nucor 0 6 8 0 2.57
SunCoke Energy 0 0 1 0 3.00

Nucor presently has a consensus target price of $66.90, indicating a potential upside of 7.98%. Given Nucor’s higher probable upside, equities research analysts plainly believe Nucor is more favorable than SunCoke Energy.

Volatility & Risk

Nucor has a beta of 1.58, meaning that its share price is 58% more volatile than the S&P 500. Comparatively, SunCoke Energy has a beta of 1.31, meaning that its share price is 31% more volatile than the S&P 500.

Insider and Institutional Ownership

74.6% of Nucor shares are owned by institutional investors. Comparatively, 91.0% of SunCoke Energy shares are owned by institutional investors. 0.7% of Nucor shares are owned by insiders. Comparatively, 3.9% of SunCoke Energy shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Nucor and SunCoke Energy’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nucor $16.21 billion 1.22 $796.27 million $3.44 18.01
SunCoke Energy $1.22 billion 0.59 $14.40 million $0.08 140.27

Nucor has higher revenue and earnings than SunCoke Energy. Nucor is trading at a lower price-to-earnings ratio than SunCoke Energy, indicating that it is currently the more affordable of the two stocks.

Summary

Nucor beats SunCoke Energy on 11 of the 17 factors compared between the two stocks.

About Nucor

Nucor Corporation (Nucor) manufactures steel and steel products. The Company produces direct reduced iron (DRI) for use in its steel mills. It operates in three segments: steel mills, steel products and raw materials. The steel mills segment produces and distributes sheet steel (hot-rolled, cold-rolled and galvanized), plate steel, structural steel (wide-flange beams, beam blanks, H-piling and sheet piling) and bar steel (blooms, billets, concrete reinforcing bar, merchant bar, wire rod and special bar quality). The steel products segment produces steel joists and joist girders, steel deck, fabricated concrete reinforcing steel and cold finished steel. The raw materials produces DRI; brokers ferrous and nonferrous metals, pig iron, HBI and DRI; supplies ferro-alloys, and processes ferrous and nonferrous scrap metal. It also processes ferrous and nonferrous metals and brokers ferrous and nonferrous metals, pig iron, hot briquetted iron (HBI) and DRI.

About SunCoke Energy

SunCoke Energy, Inc. is a producer of coke in the Americas. The Company’s segments include Domestic Coke, Brazil Coke, Coal Logistics, and Corporate and Other. The Domestic Coke segment consists of its Jewell Coke Company, L.P. (Jewell), Indiana Harbor Coke Company (Indiana Harbor), Haverhill Coke Company LLC (Haverhill), Gateway Energy and Coke Company, LLC (Granite City) and Middletown Coke Company, LLC (Middletown) cokemaking and heat recovery operations. The Brazil Coke segment consists of its operations in Vitoria, Brazil, where the Company operate a cokemaking facility, ArcelorMittal Brasil S.A. The Coal Logistics segment consists of its Convent Marine Terminal (CMT), Kanawha River Terminals, LLC (KRT), SunCoke Lake Terminal, LLC (Lake Terminal) and Dismal River Terminal, LLC (DRT) coal handling and/or mixing service operations. It designs, develops, builds, owns and operates five cokemaking facilities in the United States, as of December 31, 2016.

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