Reviewing VSE (NASDAQ:VSEC) & Metallurgical Corp. of China (OTCMKTS:MLLUY)

VSE (NASDAQ:VSEC) and Metallurgical Corp. of China (OTCMKTS:MLLUY) are both construction companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, dividends, risk, profitability, analyst recommendations, earnings and institutional ownership.

Profitability

This table compares VSE and Metallurgical Corp. of China’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
VSE	1.94%	7.37%	4.11%
Metallurgical Corp. of China	N/A	N/A	N/A

Analyst Recommendations

This is a summary of recent recommendations for VSE and Metallurgical Corp. of China, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
VSE	0	0	5	0	3.00
Metallurgical Corp. of China	0	0	0	0	0.00

VSE presently has a consensus target price of $136.00, suggesting a potential downside of 7.02%. Given VSE’s stronger consensus rating and higher probable upside, equities analysts clearly believe VSE is more favorable than Metallurgical Corp. of China.

Dividends

VSE pays an annual dividend of $0.40 per share and has a dividend yield of 0.3%. Metallurgical Corp. of China pays an annual dividend of $0.11 per share and has a dividend yield of 2.8%. VSE pays out 35.7% of its earnings in the form of a dividend. Metallurgical Corp. of China pays out 15.1% 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. Metallurgical Corp. of China is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional and Insider Ownership

91.5% of VSE shares are held by institutional investors. 14.6% of VSE shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Risk & Volatility

VSE has a beta of 1.26, indicating that its stock price is 26% more volatile than the S&P 500. Comparatively, Metallurgical Corp. of China has a beta of 0.66, indicating that its stock price is 34% less volatile than the S&P 500.

Earnings & Valuation

This table compares VSE and Metallurgical Corp. of China”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
VSE	$1.10 billion	2.75	$15.32 million	$1.12	130.60
Metallurgical Corp. of China	$76.79 billion	N/A	$938.36 million	$0.73	5.29

Metallurgical Corp. of China has higher revenue and earnings than VSE. Metallurgical Corp. of China is trading at a lower price-to-earnings ratio than VSE, indicating that it is currently the more affordable of the two stocks.

Summary

VSE beats Metallurgical Corp. of China on 11 of the 15 factors compared between the two stocks.

About VSE

VSE Corporation operates as a diversified aftermarket products and services company in the United States. The company operates through two segments, Aviation and Fleet. The Aviation segment provides aftermarket parts supply and distribution; maintenance, repair, and overhaul services for components and engine accessories supporting commercial, business, and general aviation operators. This segment serves commercial airlines, regional airlines, cargo transporters, MRO integrators and providers, aviation manufacturers, corporate and private aircraft owners, and fixed-base operators. The Fleet segment offers parts supply, inventory management, e-commerce fulfillment, logistics, supply chain support, and other services to support the commercial aftermarket medium- and heavy-duty truck market. This segment also provides sale of vehicle parts and supply chain services to support client truck fleets, as well as sustainment solutions and managed inventory services to government and commercial truck fleets. VSE Corporation was incorporated in 1959 and is headquartered in Alexandria, Virginia.

About Metallurgical Corp. of China

Metallurgical Corporation of China Ltd., together with its subsidiaries, engages in the engineering contracting, property development, equipment manufacture, and resource development businesses in China and internationally. The company’s Engineering Contracting segment offers engineering, construction, and other related contracting services for metallurgical and non-metallurgical projects. Its Property Development segment develops and sells residential and commercial properties, and housing properties; and develops land. The company’s Equipment Manufacturing segment engages in the development and production of metallurgical equipment, steel structures, and other metal products. Its Resource Development segment is involved in the development, mining, and processing of mineral resources; and the production of nonferrous metals and polysilicon. The company was founded in 2008 and is based in Beijing, the People’s Republic of China.