United States Steel (X) versus Carpenter Technology (CRS) Head to Head Comparison

United States Steel (NYSE: X) and Carpenter Technology (NYSE:CRS) are both mid-cap basic materials companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, dividends, valuation, institutional ownership, profitability and risk.

Risk & Volatility

United States Steel has a beta of 3, suggesting that its stock price is 200% more volatile than the S&P 500. Comparatively, Carpenter Technology has a beta of 2.07, suggesting that its stock price is 107% more volatile than the S&P 500.

Earnings & Valuation

This table compares United States Steel and Carpenter Technology’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
United States Steel $10.26 billion 0.54 -$440.00 million $0.68 46.84
Carpenter Technology $1.80 billion 1.32 $47.00 million $1.61 31.41

Carpenter Technology has lower revenue, but higher earnings than United States Steel. Carpenter Technology is trading at a lower price-to-earnings ratio than United States Steel, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares United States Steel and Carpenter Technology’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
United States Steel 1.05% 10.27% 2.67%
Carpenter Technology 4.06% 6.67% 2.77%

Dividends

United States Steel pays an annual dividend of $0.20 per share and has a dividend yield of 0.6%. Carpenter Technology pays an annual dividend of $0.72 per share and has a dividend yield of 1.4%. United States Steel pays out 29.4% of its earnings in the form of a dividend. Carpenter Technology pays out 44.7% 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 & Insider Ownership

64.3% of United States Steel shares are owned by institutional investors. Comparatively, 96.0% of Carpenter Technology shares are owned by institutional investors. 1.0% of United States Steel shares are owned by company insiders. Comparatively, 4.5% of Carpenter Technology shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings for United States Steel and Carpenter Technology, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
United States Steel 2 7 8 0 2.35
Carpenter Technology 0 3 3 0 2.50

United States Steel currently has a consensus price target of $29.06, indicating a potential downside of 8.75%. Carpenter Technology has a consensus price target of $46.60, indicating a potential downside of 7.85%. Given Carpenter Technology’s stronger consensus rating and higher probable upside, analysts plainly believe Carpenter Technology is more favorable than United States Steel.

Summary

Carpenter Technology beats United States Steel on 11 of the 16 factors compared between the two stocks.

About United States Steel

United States Steel Corporation is an integrated steel producer. The Company is engaged in producing flat-rolled and tubular products with production operations in North America and Europe. The Company operates through three segments: Flat-Rolled Products (Flat-Rolled), U. S. Steel Europe (USSE) and Tubular Products (Tubular). The Flat-Rolled segment includes the operating results of its integrated steel plants and equity investees in the United States involved in the production of slabs, rounds, strip mill plates, sheets and tin mill products, as well as all iron ore and coke production facilities in the United States. The USSE segment includes the operating results of U. S. Steel Kosice (USSK) and its integrated steel plant and coke production facilities in Slovakia. The Tubular segment includes the operating results of its tubular production facilities, primarily in the United States and equity investees in the United States and Brazil.

About Carpenter Technology

Carpenter Technology Corporation is engaged in the manufacturing, fabrication and distribution of specialty metals. The Company’s segments include Specialty Alloys Operations (SAO) and Performance Engineered Products (PEP). Its SAO segment consists of alloy and stainless steel manufacturing operations. Its PEP segment includes the Dynamet titanium business, the Carpenter Powder Products business, the Amega West business, the Specialty Steel Supply business and the Latrobe and Mexico distribution businesses. It develops, manufactures and distributes cast/wrought and powder metal stainless steels, and special alloys, including high temperature (iron-nickel-cobalt base), stainless, corrosion resistant, controlled expansion alloys, ultra-high strength and implantable alloys, tool and die steels and other specialty metals, as well as cast/wrought titanium alloys. The Company manufactures and rents down-hole drilling tools and components used in the oil and gas industry.

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