Reviewing Outokumpu Oyj (OTCMKTS:OUTKY) and Secom (OTCMKTS:SOMLY)

Date:



Outokumpu Oyj (OTCMKTS:OUTKYGet Rating) and Secom (OTCMKTS:SOMLYGet Rating) are both basic materials companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, valuation, profitability, dividends, earnings, institutional ownership and risk.

Earnings & Valuation

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This table compares Outokumpu Oyj and Secom’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Outokumpu Oyj $9.12 billion 0.27 $654.25 million $0.70 3.91
Secom $9.35 billion 1.59 $839.04 million $0.96 16.63

Secom has higher revenue and earnings than Outokumpu Oyj. Outokumpu Oyj is trading at a lower price-to-earnings ratio than Secom, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings for Outokumpu Oyj and Secom, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Outokumpu Oyj 0 3 4 0 2.57
Secom 0 0 0 0 N/A

Outokumpu Oyj presently has a consensus target price of $7.65, indicating a potential upside of 179.20%. Given Outokumpu Oyj’s higher probable upside, equities research analysts plainly believe Outokumpu Oyj is more favorable than Secom.

Profitability

This table compares Outokumpu Oyj and Secom’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Outokumpu Oyj 7.15% 19.29% 8.72%
Secom 9.00% 7.60% 5.05%

Dividends

Outokumpu Oyj pays an annual dividend of $0.05 per share and has a dividend yield of 1.8%. Secom pays an annual dividend of $0.21 per share and has a dividend yield of 1.3%. Outokumpu Oyj pays out 7.1% of its earnings in the form of a dividend. Secom pays out 21.9% 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. Outokumpu Oyj is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility & Risk

Outokumpu Oyj has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500. Comparatively, Secom has a beta of 0.26, suggesting that its share price is 74% less volatile than the S&P 500.

Summary

Outokumpu Oyj beats Secom on 7 of the 13 factors compared between the two stocks.

About Outokumpu Oyj (Get Rating)

Outokumpu Oyj produces and sells various stainless steel products in Finland, other European countries, North America, the Asia-Pacific, and internationally. It offers cold rolled coils, strips, and sheets; precision strips; hot rolled coils, strips, and plates; quarto plates; precise components, including welded stainless-steel I-beams, H-beams, hollow-section tubes, bent profiles, structural sections, press plates, roll shells, and blancs and disks; semi-finished stainless steel long products comprising billets and blooms, forged and rolled billets, cast slabs, ingots, and rebar; and stainless steel wire rods, wires, and bars. Its products are used in various applications, including commercial kitchen, cooking, food industry, and home appliances; automotive and transportation; building and infrastructure; energy and marine; and heavy industries. Outokumpu Oyj was founded in 1910 and is headquartered in Helsinki, Finland.

About Secom (Get Rating)

SECOM CO., LTD. provides security services in Japan and internationally. The company’s Security Services segment provides online security systems, static guard services, armored car services. Its Fire Protection Services segment provides automatic fire alarm systems, fire extinguishing systems, other fire protection systems, and related maintenance services to office buildings, plants, tunnels, cultural properties, ships and residences. This segment also provides maintenance services. The company’s Medical Services segment offers home medical services; operates general hospital, pharmacies, and residences for seniors; provides electronic medical report systems; health and preventative care services; and sells medical equipment and pharmaceuticals. Its Insurance Services Segment provides fire insurance, automobile insurance, and cancer treatment insurance services. The company’s Geospatial Information Services segment provides geospatial information services to public-sector entities, including national and local governments; private sector customers; and to overseas government agencies. Its BPO and ICT Services segment offers data center services, disaster preparedness services, BCP support services, information security services, cloud-based services, and BPO services. The Real Estate and Other Services segment engages in development and sale of condominiums equipped with distinctive security and disaster preparedness features, as well as real estate leasing, construction, installation, and other services. The company also offers electrical engineering, general office, credit, clerical, and software development services; sells security and water-treatment equipment; operates PFI correctional facilities, restaurants and shops at medical facilities; and provides lifestyle support and car maintains services, as well as sells and maintains freight elevators. The company was founded in 1962 and is headquartered in Tokyo, Japan.



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