Analyzing NN (NASDAQ:NNBR) and GrafTech International (NYSE:EAF)

GrafTech International (NYSE:EAF) and NN (NASDAQ:NNBR) are both small-cap industrials companies, but which is the superior stock? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, dividends, profitability, valuation, risk and earnings.

Analyst Recommendations

This is a summary of current recommendations and price targets for GrafTech International and NN, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GrafTech International	1	5	0	0	1.83
NN	1	1	0	1	2.33

GrafTech International currently has a consensus price target of $14.25, suggesting a potential downside of 16.89%. NN has a consensus price target of $4.00, suggesting a potential upside of 236.13%. Given NN’s stronger consensus rating and higher probable upside, analysts clearly believe NN is more favorable than GrafTech International.

Risk & Volatility

GrafTech International has a beta of 1.72, suggesting that its share price is 72% more volatile than the S&P 500. Comparatively, NN has a beta of 2.3, suggesting that its share price is 130% more volatile than the S&P 500.

Profitability

This table compares GrafTech International and NN’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GrafTech International	-39.13%	N/A	-11.72%
NN	-10.01%	-2.09%	-0.29%

Insider & Institutional Ownership

92.8% of GrafTech International shares are held by institutional investors. Comparatively, 53.9% of NN shares are held by institutional investors. 1.0% of GrafTech International shares are held by insiders. Comparatively, 7.9% of NN shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Earnings & Valuation

This table compares GrafTech International and NN”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GrafTech International	$521.89 million	0.85	-$131.16 million	($7.90)	-2.17
NN	$464.29 million	0.13	-$38.27 million	($1.23)	-0.97

NN has lower revenue, but higher earnings than GrafTech International. GrafTech International is trading at a lower price-to-earnings ratio than NN, indicating that it is currently the more affordable of the two stocks.

Summary

NN beats GrafTech International on 10 of the 14 factors compared between the two stocks.

About GrafTech International

GrafTech International Ltd. research, develops, manufactures, and sells graphite and carbon-based solutions worldwide. The company offers graphite electrodes to produce electric arc furnace steel and other ferrous and non-ferrous metals; and petroleum needle coke, a crystalline form of carbon used in the production of graphite electrodes and synthetic graphite. It sells its products primarily through direct sales force, independent sales representatives, and distributors. GrafTech International Ltd. was founded in 1886 and is headquartered in Brooklyn Heights, Ohio.

About NN

NN, Inc., together with its subsidiaries, designs, manufactures, and sells high-precision components and assemblies for various end markets in the United States and internationally. It operates through two segments, Mobile Solutions and Power Solutions. The Mobile Solutions segment manufactures and sells system critical components for automotive, general industrial, and medical end markets for use in power steering, braking, transmissions, gasoline fuel system, diesel injection, and diesel emissions treatment applications, as well as in heating, ventilation, and air conditioning. The Power Solutions segment designs, manufactures, and sells a range of high-precision metal and plastic components, assemblies, and finished devices used in various applications, such as power control and transportation electrification. Its products include electrical contacts, connectors, contact assemblies, and precision stampings for the electrical, general industrial, automotive, aerospace and defense, and medical end markets. This segment also produces various tools and instruments for the orthopaedics and medical/surgical end markets. NN, Inc. was founded in 1980 and is headquartered in Charlotte, North Carolina.