Contrasting Sigma Lithium (NASDAQ:SGML) and Cleveland-Cliffs (NYSE:CLF)
by Doug Wharley · The Cerbat GemSigma Lithium (NASDAQ:SGML – Get Free Report) and Cleveland-Cliffs (NYSE:CLF – Get Free Report) are both materials companies, but which is the better business? We will contrast the two companies based on the strength of their risk, analyst recommendations, earnings, institutional ownership, valuation, dividends and profitability.
Profitability
This table compares Sigma Lithium and Cleveland-Cliffs’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Sigma Lithium | -19.36% | -37.40% | -7.66% |
| Cleveland-Cliffs | -4.56% | -13.37% | -3.96% |
Insider and Institutional Ownership
64.9% of Sigma Lithium shares are owned by institutional investors. Comparatively, 67.7% of Cleveland-Cliffs shares are owned by institutional investors. 48.6% of Sigma Lithium shares are owned by company insiders. Comparatively, 0.9% of Cleveland-Cliffs shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Earnings and Valuation
This table compares Sigma Lithium and Cleveland-Cliffs”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sigma Lithium | $110.01 million | 10.20 | -$50.19 million | ($0.24) | -41.54 |
| Cleveland-Cliffs | $18.61 billion | 0.38 | -$1.48 billion | ($1.62) | -7.73 |
Sigma Lithium has higher earnings, but lower revenue than Cleveland-Cliffs. Sigma Lithium is trading at a lower price-to-earnings ratio than Cleveland-Cliffs, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Sigma Lithium has a beta of 0.64, meaning that its share price is 36% less volatile than the S&P 500. Comparatively, Cleveland-Cliffs has a beta of 2.1, meaning that its share price is 110% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of recent ratings and price targets for Sigma Lithium and Cleveland-Cliffs, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sigma Lithium | 3 | 0 | 4 | 0 | 2.14 |
| Cleveland-Cliffs | 2 | 7 | 2 | 0 | 2.00 |
Sigma Lithium presently has a consensus price target of $17.38, suggesting a potential upside of 74.27%. Cleveland-Cliffs has a consensus price target of $12.06, suggesting a potential downside of 3.71%. Given Sigma Lithium’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Sigma Lithium is more favorable than Cleveland-Cliffs.
About Sigma Lithium
Sigma Lithium Corporation engages in the exploration and development of lithium deposits in Brazil. It holds a 100% interest in the Grota do Cirilo, Genipapo, Santa Clara, and São José properties comprising 29 mineral rights covering an area of approximately 185 square kilometers located in the Araçuaí and Itinga regions of the state of Minas Gerais, Brazil. It serves electric vehicle industries worldwide. The company was formerly known as Sigma Lithium Resources Corporation and changed its name to Sigma Lithium Corporation in July 2021. The company is headquartered in São Paulo, Brazil.
About Cleveland-Cliffs
Cleveland-Cliffs is the largest flat-rolled steel company and the largest iron ore pellet producer in North America. The company is vertically integrated from mining through iron making, steelmaking, rolling, finishing and downstream with hot and cold stamping of steel parts and components. The company was formerly known as Cliffs Natural Resources Inc. and changed its name to Cleveland-Cliffs Inc. in August 2017. Cleveland-Cliffs Inc. was founded in 1847 and is headquartered in Cleveland, Ohio.