Cliffs Natural Resources (NYSE: CLF) and Dynamic Materials Corp. (NASDAQ:BOOM) are both basic materials companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, earnings, risk, analyst recommendations, valuation, institutional ownership and profitability.
Dynamic Materials Corp. pays an annual dividend of $0.08 per share and has a dividend yield of 0.6%. Cliffs Natural Resources does not pay a dividend. Dynamic Materials Corp. pays out -14.0% of its earnings in the form of a dividend.
This table compares Cliffs Natural Resources and Dynamic Materials Corp.’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Cliffs Natural Resources||2.44%||-13.83%||7.41%|
|Dynamic Materials Corp.||-5.01%||-6.38%||-4.39%|
Institutional & Insider Ownership
65.2% of Cliffs Natural Resources shares are owned by institutional investors. Comparatively, 85.5% of Dynamic Materials Corp. shares are owned by institutional investors. 0.5% of Cliffs Natural Resources shares are owned by insiders. Comparatively, 3.2% of Dynamic Materials Corp. shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
Earnings and Valuation
This table compares Cliffs Natural Resources and Dynamic Materials Corp.’s top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Cliffs Natural Resources||$2.34 billion||0.94||$480.50 million||$0.22||33.64|
|Dynamic Materials Corp.||$162.88 million||1.19||$7.00 million||($0.57)||-23.07|
Cliffs Natural Resources has higher revenue and earnings than Dynamic Materials Corp.. Dynamic Materials Corp. is trading at a lower price-to-earnings ratio than Cliffs Natural Resources, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Cliffs Natural Resources has a beta of 1.69, meaning that its share price is 69% more volatile than the S&P 500. Comparatively, Dynamic Materials Corp. has a beta of 0.89, meaning that its share price is 11% less volatile than the S&P 500.
This is a summary of recent ratings and target prices for Cliffs Natural Resources and Dynamic Materials Corp., as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Cliffs Natural Resources||3||2||4||0||2.11|
|Dynamic Materials Corp.||0||0||1||0||3.00|
Cliffs Natural Resources currently has a consensus target price of $8.29, indicating a potential upside of 11.97%. Dynamic Materials Corp. has a consensus target price of $19.00, indicating a potential upside of 44.49%. Given Dynamic Materials Corp.’s stronger consensus rating and higher probable upside, analysts clearly believe Dynamic Materials Corp. is more favorable than Cliffs Natural Resources.
Dynamic Materials Corp. beats Cliffs Natural Resources on 8 of the 15 factors compared between the two stocks.
About Cliffs Natural Resources
Cliffs Natural Resources Inc. is a mining and natural resources company. The Company is a supplier of iron ore pellets to the North American steel industry from its mines and pellet plants located in Michigan and Minnesota. The Company’s segments include U.S. Iron Ore and Asia Pacific Iron Ore. The Company is a producer of iron ore pellets, primarily selling production from U.S. Iron Ore to integrated steel companies in the United States, Canada and Mexico. Its Asia Pacific Iron Ore operations are located in Western Australia and consist of its Koolyanobbing operation. The Koolyanobbing operations serve the Asian iron ore markets with direct-shipped fines and lump ore. In addition, the Company operates an iron ore mining complex in Western Australia. In the United States, the Company owned four operational iron ore mines and one indefinitely idled mine, as of December 31, 2016. As of December 31, 2016, it operated four iron ore mines located in Michigan and Minnesota.
About Dynamic Materials Corp.
DMC Global Inc., formerly Dynamic Materials Corporation, is a diversified technology company. The Company operates a family of technical product and process businesses serving the energy, industrial and infrastructure markets. The Company’s businesses operate through an international network of manufacturing, distribution and sales facilities. The Company’s segments are NobelClad and DynaEnergetics. The NobelClad segment is engaged in the production of explosion-welded clad metal plates for use in the construction of corrosion resistant industrial processing equipment and specialized transition joints. The DynaEnergetics segment manufactures, markets and sells oilfield perforating equipment and explosives, including detonating cords, detonators, bi-directional boosters and shaped charges, and seismic related explosives and accessories. It owns explosive metalworking and metallic processes, and registered trademarks, including Detaclad, Detacouple, EFTEK, ETJ 2000 and NOBELCLAD.
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