DMC Global (NASDAQ:BOOM) & Global Industrial (NYSE:GIC) Critical Review

Global Industrial (NYSE:GIC) and DMC Global (NASDAQ:BOOM) are both small-cap industrials companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, institutional ownership, profitability and dividends.

Earnings & Valuation

This table compares Global Industrial and DMC Global”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Global Industrial	$1.34 billion	0.78	$61.00 million	$1.75	15.38
DMC Global	$618.68 million	0.19	-$94.45 million	($0.47)	-12.21

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

Insider & Institutional Ownership

31.2% of Global Industrial shares are owned by institutional investors. Comparatively, 77.6% of DMC Global shares are owned by institutional investors. 64.2% of Global Industrial shares are owned by insiders. Comparatively, 2.8% of DMC Global shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Global Industrial and DMC Global, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Global Industrial	1	1	0	0	1.50
DMC Global	2	1	0	0	1.33

DMC Global has a consensus price target of $8.50, suggesting a potential upside of 48.08%. Given DMC Global’s higher possible upside, analysts plainly believe DMC Global is more favorable than Global Industrial.

Dividends

Global Industrial pays an annual dividend of $1.04 per share and has a dividend yield of 3.9%. DMC Global pays an annual dividend of $0.50 per share and has a dividend yield of 8.7%. Global Industrial pays out 59.4% of its earnings in the form of a dividend. DMC Global pays out -106.4% 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. Global Industrial has raised its dividend for 9 consecutive years. DMC Global is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

This table compares Global Industrial and DMC Global’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Global Industrial	5.11%	22.85%	12.11%
DMC Global	-17.54%	-1.27%	-0.48%

Risk & Volatility

Global Industrial has a beta of 0.93, indicating that its share price is 7% less volatile than the S&P 500. Comparatively, DMC Global has a beta of 1.51, indicating that its share price is 51% more volatile than the S&P 500.

Summary

Global Industrial beats DMC Global on 11 of the 16 factors compared between the two stocks.

About Global Industrial

Global Industrial Company operates as an industrial distributor of various industrial and maintenance, repair, and operation (MRO) products in North America. It offers storage and shelving, safety and security, carts and trucks, HVAC and fans, furniture and decor, material handling, janitorial and facility maintenance, workbenches and shop desks, tools and instruments, plumbing and pumps, office and school supplies, packaging and shipping, lighting and electrical, foodservice and retail, medical and laboratory, motors and power transmission, building supplies, machining, fasteners and hardware, vehicle maintenance, and raw materials. The company offers industrial and MRO products under the Global, GlobalIndustrial.com, Nexel, Paramount, Interion, and Absocold trademarks. It serves businesses; state, local, and private educational organizations; and government entities through relationship marketers, e-commerce sites, signature campaigns, and catalogs. The company was formerly known as Systemax Inc. Global Industrial Company was founded in 1949 and is headquartered in Port Washington, New York.

About DMC Global

DMC Global Inc. provides a suite of engineered products and various solutions for the construction, energy, industrial processing, and transportation markets worldwide. The company operates through three segments: Arcadia, DynaEnergetics, and NobelClad. The Arcadia segment manufactures, assembles, and sells architectural building products, including exterior and interior framing systems, curtain walls, windows, doors, and interior partitions; architectural components, architectural framing systems, entrance systems, and sun control products; sliding and glazing systems; and thermally broken steel, aluminum windows and doors, and wood doors and windows. It sells its products through a national in-house sales force for buildings, such as office towers, airports, hotels, education and athletic facilities, health care locations, government buildings, retail centers, mixed use, and multi-family residential buildings. The DynaEnergetics segment designs, manufactures, markets, and sells perforating systems, including initiation systems, shaped charges, detonating cords, gun hardware, and control panels; and perforating systems and associated hardware for the oil and gas industry. It sells its products through direct selling, distributors, and independent sales representatives. The NobelClad segment produces and sells explosion-welded clad metal plates for use in the construction of heavy, corrosion resistant pressure vessels, and heat exchangers for oil and gas, chemical and petrochemical, alternative energy, hydrometallurgy, aluminum production, shipbuilding, rail car manufacturing, power generation, and industrial refrigeration industries. It sells its products through direct sales personnel, program managers, and independent sales representatives. The company was formerly known as Dynamic Materials Corporation and changed its name to DMC Global Inc. in November 2016. DMC Global Inc. was founded in 1965 and is headquartered in Broomfield, Colorado.