Financial Analysis: ThyssenKrupp (OTCMKTS:TKAMY) versus POSCO (NYSE:PKX)

ThyssenKrupp (OTCMKTS:TKAMY) and POSCO (NYSE:PKX) are both basic materials companies, but which is the superior stock? We will contrast the two businesses based on the strength of their profitability, institutional ownership, risk, valuation, analyst recommendations, dividends and earnings.

Profitability

This table compares ThyssenKrupp and POSCO’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ThyssenKrupp	-3.04%	-9.70%	-3.53%
POSCO	0.69%	0.81%	0.49%

Earnings & Valuation

This table compares ThyssenKrupp and POSCO”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ThyssenKrupp	$38.01 billion	0.19	-$1.63 billion	($1.80)	-6.34
POSCO	$53.28 billion	0.30	$787.77 million	$0.81	64.14

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

Volatility & Risk

ThyssenKrupp has a beta of 1.26, indicating that its share price is 26% more volatile than the S&P 500. Comparatively, POSCO has a beta of 1.36, indicating that its share price is 36% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for ThyssenKrupp and POSCO, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ThyssenKrupp	2	0	0	2	2.50
POSCO	0	0	1	0	3.00

Dividends

ThyssenKrupp pays an annual dividend of $0.09 per share and has a dividend yield of 0.8%. POSCO pays an annual dividend of $1.43 per share and has a dividend yield of 2.8%. ThyssenKrupp pays out -5.0% of its earnings in the form of a dividend. POSCO pays out 176.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Summary

POSCO beats ThyssenKrupp on 12 of the 14 factors compared between the two stocks.

About ThyssenKrupp

thyssenkrupp AG operates as an industrial and technology company in Germany and internationally. It operates through five segments: Automotive Technology, Decarbon Technologies, Materials Services, Steel Europe, and Marine Systems. The Automotive Technology segment offers components, systems, and automation solutions for vehicle manufacturing, such as axle assembly, body in white, camshafts and electric engine components, dampers, dies, springs and stabilizers, crankshafts and conrods, steering, and undercarriages. The Decarbon Technologies segment provides slewing bearings and rings, green ammonia and methanol, chemical and cement plants, high pressure processing, and refinery services, as well as green hydrogen. The Marine System segment manufactures submarines, naval services, and naval surface vessels. The Material Services segment offers 3D-printing/additive manufacturing, alloys, infrastructure project and services, industrial minerals, logistics services, metals, nonferrous metals, plastics, rolled steel, special ores, and stainless steel. The Steel Europe segment manufactures composite materials, electrical steel, hot strips, organic coated strips and sheet, packaging steel, precision steel strip, and sheet and coated products. thyssenkrupp AG was founded in 1811 and is headquartered in Essen, Germany.

About POSCO

POSCO Holdings Inc., together with its subsidiaries, operates as an integrated steel producer in Korea and internationally. It operates through six segments: Steel, Trading, Construction, Logistics and Others, Green Materials and Energy, and Others. The company engages in the production, import, sale, and export of steel products, such as hot and cold rolled steel, stainless steel, plates, wire rods, and silicon steel sheets, as well as pig iron, billets, blooms, and slabs; trading of steel and raw materials, textiles, agricultural commodities, and other goods; natural resources development and power generation activities; and planning, designing, and construction of industrial plants, civil engineering projects, and commercial and residential buildings. It is also involved in the manufacture and sale of various energy-related and other industrial materials, including anode and cathode materials for rechargeable batteries; investment business; and provision of alternative environmentally-friendly energy solutions, as well as information technology and operational technology, and integrated logistics services. POSCO Holdings Inc. was incorporated in 1968 and is based in Seoul, South Korea.