Critical Review: United States Steel Corporation (X) vs. Gibraltar Industries (ROCK)

United States Steel Corporation (NYSE: X) and Gibraltar Industries (NASDAQ:ROCK) are both basic materials companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, valuation, institutional ownership, risk, dividends, earnings and analyst recommendations.

Analyst Ratings

This is a summary of current ratings and recommmendations for United States Steel Corporation and Gibraltar Industries, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
United States Steel Corporation 3 6 8 0 2.29
Gibraltar Industries 0 0 2 0 3.00

United States Steel Corporation presently has a consensus price target of $27.91, indicating a potential upside of 9.30%. Gibraltar Industries has a consensus price target of $34.50, indicating a potential upside of 18.97%. Given Gibraltar Industries’ stronger consensus rating and higher possible upside, analysts clearly believe Gibraltar Industries is more favorable than United States Steel Corporation.

Valuation and Earnings

This table compares United States Steel Corporation and Gibraltar Industries’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
United States Steel Corporation $11.21 billion 0.40 $838.00 million $0.16 159.56
Gibraltar Industries $958.80 million 0.96 $109.22 million $0.71 40.85

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

Profitability

This table compares United States Steel Corporation and Gibraltar Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
United States Steel Corporation 0.24% 6.50% 1.67%
Gibraltar Industries 2.38% 10.14% 5.09%

Insider & Institutional Ownership

63.4% of United States Steel Corporation shares are held by institutional investors. 1.0% of United States Steel Corporation shares are held by company insiders. Comparatively, 0.5% of Gibraltar Industries shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Dividends

United States Steel Corporation pays an annual dividend of $0.20 per share and has a dividend yield of 0.8%. Gibraltar Industries does not pay a dividend. United States Steel Corporation pays out 125.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Volatility and Risk

United States Steel Corporation has a beta of 2.88, indicating that its share price is 188% more volatile than the S&P 500. Comparatively, Gibraltar Industries has a beta of 1.81, indicating that its share price is 81% more volatile than the S&P 500.

United States Steel Corporation Company Profile

United States Steel Corporation is an integrated steel producer. The Company is engaged in producing flat-rolled and tubular products with production operations in North America and Europe. The Company operates through three segments: Flat-Rolled Products (Flat-Rolled), U. S. Steel Europe (USSE) and Tubular Products (Tubular). The Flat-Rolled segment includes the operating results of its integrated steel plants and equity investees in the United States involved in the production of slabs, rounds, strip mill plates, sheets and tin mill products, as well as all iron ore and coke production facilities in the United States. The USSE segment includes the operating results of U. S. Steel Kosice (USSK) and its integrated steel plant and coke production facilities in Slovakia. The Tubular segment includes the operating results of its tubular production facilities, primarily in the United States and equity investees in the United States and Brazil.

Gibraltar Industries Company Profile

Gibraltar Industries, Inc. is a manufacturer and distributor of building products for industrial, transportation infrastructure, residential housing, renewable energy and resource conservation markets. The Company’s segments include Residential Products; Industrial and Infrastructure Products, and Renewable Energy and Conservation. The Residential Products segment services residential housing construction and residential repair and remodeling activity with products including roof and foundation ventilation products, rain dispersion products and roof ventilation accessories. The Industrial and Infrastructure Products segment focuses on a range of markets, including industrial and commercial construction, automotive, airports and energy and power generation markets with products. The Renewable Energy and Conservation segment focuses on the design, engineering, manufacturing and installation of solar racking systems and commercial, institutional and retail greenhouse structures.

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