Iamgold (NYSE:IAG) versus Outokumpu (OTCMKTS:OUTKY) Financial Analysis
by Michael Walen · The Markets DailyIamgold (NYSE:IAG – Get Free Report) and Outokumpu (OTCMKTS:OUTKY – Get Free Report) are both materials companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, analyst recommendations, institutional ownership, profitability and risk.
Profitability
This table compares Iamgold and Outokumpu’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Iamgold | 31.40% | 28.97% | 20.87% |
| Outokumpu | -1.48% | -2.38% | -1.41% |
Volatility & Risk
Iamgold has a beta of 1.4, meaning that its stock price is 40% more volatile than the S&P 500. Comparatively, Outokumpu has a beta of 0.72, meaning that its stock price is 28% less volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current ratings and price targets for Iamgold and Outokumpu, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Iamgold | 0 | 3 | 5 | 2 | 2.90 |
| Outokumpu | 0 | 4 | 2 | 0 | 2.33 |
Iamgold currently has a consensus price target of $21.83, suggesting a potential upside of 6.94%. Given Iamgold’s stronger consensus rating and higher probable upside, research analysts clearly believe Iamgold is more favorable than Outokumpu.
Institutional & Insider Ownership
47.1% of Iamgold shares are held by institutional investors. 0.2% of Iamgold shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Earnings and Valuation
This table compares Iamgold and Outokumpu”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Iamgold | $2.85 billion | 4.07 | $664.40 million | $1.98 | 10.31 |
| Outokumpu | $6.19 billion | 0.46 | -$155.00 million | ($0.10) | -29.90 |
Iamgold has higher earnings, but lower revenue than Outokumpu. Outokumpu is trading at a lower price-to-earnings ratio than Iamgold, indicating that it is currently the more affordable of the two stocks.
Summary
Iamgold beats Outokumpu on 14 of the 15 factors compared between the two stocks.
About Iamgold
IAMGOLD Corporation, through its subsidiaries, operates as an intermediate gold producer and developer in Canada and Burkina Faso. It owns 100% interest in the Westwood project that covers an area of 1,925 hectare and located in Quebec; a 60% interest in the Côté gold project, which covers an area of 596 square kilometer located in Ontario, Canada; and a 90% interests in the Essakane project that covers an area of 274,000 square kilometer situated in Burkina Faso. IAMGOLD Corporation was incorporated in 1990 and is headquartered in Toronto, Canada.
About Outokumpu
Outokumpu Oyj produces and sells various stainless steel products in Finland, other European countries, North America, the Asia-Pacific, and internationally. The company operates through three segments: Europe, Americas, and Ferrochrome. It offers cold rolled coils, strips, and sheets; hot rolled coils, strips, and plates; quarto plates; precision strips; and specialized components, such as welded stainless-steel I-beams, H-beams, hollow-section tubes, bent profiles, structural sections, hardened and customized press plates, suction roll shells, and blancs and disks. The company also provides stainless steel powder which includes Supra 316L, Dura 17-4PH, Ultra 904L, Therma 253MA, Dura 4116, and Ni-free austenitic stainless steel powder; and nickel-based alloys. Its products are used in various applications, including commercial kitchen, cooking, food industry, and home appliances; automotive and transportation; building and infrastructure; energy; marine; and heavy industries. The company was founded in 1910 and is headquartered in Helsinki, Finland.