Head to Head Contrast: Mueller Industries (NYSE:MLI) & Friedman Industries (NASDAQ:FRD)

Friedman Industries (NASDAQ:FRD) and Mueller Industries (NYSE:MLI) are both industrials companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, institutional ownership, earnings, dividends, valuation, profitability and analyst recommendations.

Earnings & Valuation

This table compares Friedman Industries and Mueller Industries”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Friedman Industries	$444.60 million	0.30	$6.09 million	$2.22	8.34
Mueller Industries	$4.18 billion	3.13	$765.19 million	$6.87	17.18

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

Risk & Volatility

Friedman Industries has a beta of 1.55, indicating that its stock price is 55% more volatile than the S&P 500. Comparatively, Mueller Industries has a beta of 1.04, indicating that its stock price is 4% more volatile than the S&P 500.

Profitability

This table compares Friedman Industries and Mueller Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Friedman Industries	2.68%	11.36%	5.86%
Mueller Industries	18.31%	24.70%	20.88%

Dividends

Friedman Industries pays an annual dividend of $0.16 per share and has a dividend yield of 0.9%. Mueller Industries pays an annual dividend of $1.00 per share and has a dividend yield of 0.8%. Friedman Industries pays out 7.2% of its earnings in the form of a dividend. Mueller Industries pays out 14.6% 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. Friedman Industries has raised its dividend for 1 consecutive years and Mueller Industries has raised its dividend for 5 consecutive years. Friedman Industries is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

33.3% of Friedman Industries shares are held by institutional investors. Comparatively, 94.5% of Mueller Industries shares are held by institutional investors. 5.5% of Friedman Industries shares are held by insiders. Comparatively, 2.7% of Mueller Industries shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations for Friedman Industries and Mueller Industries, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Friedman Industries	0	0	1	0	3.00
Mueller Industries	0	0	1	0	3.00

Summary

Mueller Industries beats Friedman Industries on 10 of the 14 factors compared between the two stocks.

About Friedman Industries

Friedman Industries, Incorporated engages in steel processing, pipe manufacturing and processing, and the steel and pipe distribution businesses the United States. It operates in two segments, Coil and Tubular. The Coil segment is involved in the conversion of steel coils into flat sheet and plate steel cut to customer specifications and reselling steel coils. This segment also processes customer-owned coils on a fee basis. The company sells coil products and processing services to approximately 200 customers located primarily in the midwestern, southwestern and southeastern regions of the United States. Its principal customers for these products and services are steel distributors and customers manufacturing steel products, such as steel buildings, railroad cars, barges, tanks and containers, trailers, component parts and other fabricated steel products. The Tubular segment manufactures line and oil country pipes, as well as pipes for structural applications. This segment sells its tubular products principally to steel and pipe distributors through its own sales force. The company was incorporated in 1965 and is headquartered in Longview, Texas.

About Mueller Industries

Mueller Industries, Inc. manufactures and sells copper, brass, aluminum, and plastic products in the United States, the United Kingdom, Canada, South Korea, the Middle East, China, and Mexico. It operates through three segments: Piping Systems, Industrial Metals, and Climate. The Piping Systems segment offers copper tubes, fittings, line sets, and pipe nipples. It also resells steel pipes, brass and plastic plumbing valves, malleable iron fittings and faucets, and plumbing specialties; and supplies water tubes. This segment sells its products to wholesalers in the plumbing and refrigeration markets, distributors to the manufactured housing and recreational vehicle industries, building material retailers, and air-conditioning original equipment manufacturers (OEMs). The Industrial Metals segment manufactures brass, bronze, and copper alloy rods; plumbing brass, valves, fittings, and gas assemblies; cold-form aluminum and copper products; machining of aluminum, steel, brass, and cast iron impacts and castings; brass and aluminum forgings; brass, aluminum, and stainless-steel valves; fluid control solutions; and gas train assembles to OEMs in the industrial, construction, HVAC, plumbing, and refrigeration markets. The Climate segment offers valves, protection devices, and brass fittings for various OEMs in the commercial HVAC and refrigeration markets; high-pressure components and accessories for the air-conditioning and refrigeration markets; coaxial heat exchangers and twisted tubes for the HVAC, geothermal, refrigeration, swimming pool heat pump, marine, ice machine, commercial boiler, and heat reclamation markets; and insulated HVAC flexible duct systems. Mueller Industries, Inc. was founded in 1917 and is headquartered in Collierville, Tennessee.