Head to Head Analysis: SSAB (OTCMKTS:SSAAY) vs. Teck Resources (NYSE:TECK)

Teck Resources (NYSE:TECK) and SSAB (OTCMKTS:SSAAY) are both large-cap materials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, valuation and dividends.

Dividends

Teck Resources pays an annual dividend of $0.36 per share and has a dividend yield of 0.5%. SSAB pays an annual dividend of $0.05 per share and has a dividend yield of 0.9%. Teck Resources pays out 9.8% of its earnings in the form of a dividend. SSAB pays out 16.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Institutional and Insider Ownership

78.1% of Teck Resources shares are held by institutional investors. 0.1% of Teck Resources shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Teck Resources and SSAB’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Teck Resources	17.85%	10.42%	6.07%
SSAB	5.73%	8.18%	5.26%

Analyst Recommendations

This is a summary of current ratings and target prices for Teck Resources and SSAB, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Teck Resources	0	7	6	0	2.46
SSAB	0	2	3	0	2.60

Teck Resources currently has a consensus target price of $62.25, suggesting a potential downside of 6.90%. Given Teck Resources’ higher probable upside, research analysts plainly believe Teck Resources is more favorable than SSAB.

Risk & Volatility

Teck Resources has a beta of 0.94, meaning that its share price is 6% less volatile than the S&P 500. Comparatively, SSAB has a beta of 1.42, meaning that its share price is 42% more volatile than the S&P 500.

Valuation & Earnings

This table compares Teck Resources and SSAB”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Teck Resources	$7.70 billion	4.20	$1.00 billion	$3.69	18.12
SSAB	$9.84 billion	1.11	$500.98 million	$0.30	18.30

Teck Resources has higher earnings, but lower revenue than SSAB. Teck Resources is trading at a lower price-to-earnings ratio than SSAB, indicating that it is currently the more affordable of the two stocks.

Summary

Teck Resources beats SSAB on 11 of the 16 factors compared between the two stocks.

About Teck Resources

Teck Resources Limited engages in exploring for, acquiring, developing, and producing natural resources in Asia, Europe, and North America. The company operates through Steelmaking Coal, Copper, Zinc, and Energy segments. Its principal products include copper, zinc, steelmaking coal, and blended bitumen. The company also produces lead, silver, and molybdenum; and various specialty and other metals, chemicals, and fertilizers. In addition, it explores for gold. The company was formerly known as Teck Cominco Limited and changed its name to Teck Resources Limited in April 2009. The company was founded in 1913 and is headquartered in Vancouver, Canada.

About SSAB

SSAB AB (publ) produces and sells steel products in Sweden, Finland, Rest of Europe, the United States, and internationally. It operates through five segments: SSAB Special Steels, SSAB Europe, SSAB Americas, Tibnor, and Ruukki Construction. The SSAB Special Steels segment offers quenched and tempered steels, and advanced high-strength steel products for steel and plate production. The SSAB Europe segment provides strip, heavy plate, and tubular products. The SSAB Americas segment sells heavy plates for steel and plate production. The Tibnor segment distributes a range of steel and non-ferrous metals in the Nordics and Baltics. The Ruukki Construction segment produces and sells energy-efficient building and construction solutions. It markets its steel products under the Strenx, Hardox, Docol, GreenCoat, Toolox, Armox, Duroxite, SSAB AM, SSAB Boron, SSAB Domex, SSAB Form, SSAB Laser, SSAB Weathering, Cor-Ten, and SSAB Multisteel brands. The company's products are used by customers in the heavy transport, construction and infrastructure, industrial applications, construction machinery, energy, and material handling markets. SSAB AB (publ) was founded in 1878 and is headquartered in Stockholm, Sweden.