Sumitomo (OTCMKTS:SSUMY – Get Free Report) and Star Equity (NASDAQ:STRR – Get Free Report) are both multi-sector conglomerates companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, institutional ownership, earnings, valuation, profitability, risk and dividends.
Volatility & Risk
Sumitomo has a beta of 0.51, indicating that its stock price is 49% less volatile than the S&P 500. Comparatively, Star Equity has a beta of 0.43, indicating that its stock price is 57% less volatile than the S&P 500.
Earnings and Valuation
This table compares Sumitomo and Star Equity”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sumitomo | $48.74 billion | 1.14 | $3.96 billion | $3.31 | 13.99 |
| Star Equity | $172.16 million | 0.25 | -$5.92 million | ($2.63) | -4.39 |
Sumitomo has higher revenue and earnings than Star Equity. Star Equity is trading at a lower price-to-earnings ratio than Sumitomo, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of recent recommendations for Sumitomo and Star Equity, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sumitomo | 0 | 1 | 0 | 1 | 3.00 |
| Star Equity | 2 | 1 | 1 | 1 | 2.20 |
Star Equity has a consensus target price of $28.00, suggesting a potential upside of 142.42%. Given Star Equity’s higher possible upside, analysts clearly believe Star Equity is more favorable than Sumitomo.
Profitability
This table compares Sumitomo and Star Equity’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Sumitomo | 8.19% | 12.21% | 4.75% |
| Star Equity | -4.18% | -4.04% | -2.40% |
Insider and Institutional Ownership
3.8% of Star Equity shares are held by institutional investors. 33.5% of Star Equity shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Summary
Sumitomo beats Star Equity on 10 of the 14 factors compared between the two stocks.
About Sumitomo
Sumitomo Corporation engages in general trading business worldwide. It operates through six segments: Metal Products; Transportation & Construction Systems; Infrastructure; Media & Digital; Living Related & Real Estate; and Mineral Resources, Energy, Chemical & Electronics. The company provides steel sheets and tubular products; and manufactures, leases, sells, services, and finances ships, aircrafts, motor vehicles, construction equipment, and components and parts. It is involved in the development of renewable energy projects comprising power generation and power plant engineering, procurement, and construction activities; electricity retail; industrial facilities and equipment, water, transportation systems and infrastructure, airports, smart city project, environmental solutions, and storage battery businesses; development and operation of industrial parks; arranging insurance; and provision of logistics services. In addition, the company engages in the cable television, 5G related technologies, programming distribution, movies, digital media and video content, TV shopping, and e-commerce businesses; cell phone, ICT platform, digital solution, and venture capital businesses; provision of smart communications infrastructure; operation of food supermarkets and drugstore chains; trade of cement and building materials; and real estate businesses. Further, it develops and trades in coal, iron ore, manganese, uranium, non-ferrous and precious metals, petroleum, natural gas and liquefied natural gas, and commodity derivative transactions; trades in non-ferrous metal products, liquefied petroleum gas, storage batteries, carbon products, plastics, organic and inorganic chemicals, silicon wafers, LEDs, pharmaceuticals, agricultural chemicals, household insecticides, fertilizers, and veterinary drugs; engages in the investing activities; and provides electronics manufacturing services. Sumitomo Corporation was incorporated in 1919 and is headquartered in Tokyo, Japan.
About Star Equity
Star Equity Holdings, Inc. engages in the construction business in the United States and internationally. It operates through two segments: Construction, and Investments. It manufactures modular housing units, structural wall panels, permanent wood foundation systems, and other engineered wood products; supplies general contractors with building materials; holds real estate assets; and manages investments. The company was formerly known as Digirad Corporation and changed its name to Star Equity Holdings, Inc. in December 2020. Star Equity Holdings, Inc. was founded in 1985 and is headquartered in Old Greenwich, Connecticut.
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