Analyzing Gerdau (NYSE:GGB) & Klöckner & Co SE (OTCMKTS:KLKNF)

Gerdau (NYSE:GGB) and Klöckner & Co SE (OTCMKTS:KLKNF) are both basic materials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, valuation, institutional ownership, risk, profitability, dividends and analyst recommendations.

Institutional & Insider Ownership

1.5% of Gerdau shares are held by institutional investors. 0.0% of Gerdau shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent recommendations for Gerdau and Klöckner & Co SE, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gerdau	0	0	2	0	3.00
Klöckner & Co SE	0	0	0	0	N/A

Gerdau currently has a consensus target price of $5.00, indicating a potential upside of 58.23%. Given Gerdau’s higher possible upside, equities research analysts plainly believe Gerdau is more favorable than Klöckner & Co SE.

Profitability

This table compares Gerdau and Klöckner & Co SE’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Gerdau	7.88%	8.43%	5.63%
Klöckner & Co SE	N/A	N/A	N/A

Valuation & Earnings

This table compares Gerdau and Klöckner & Co SE”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gerdau	$64.60 billion	0.10	$1.50 billion	$0.61	5.18
Klöckner & Co SE	N/A	N/A	N/A	N/A	N/A

Gerdau has higher revenue and earnings than Klöckner & Co SE.

Summary

Gerdau beats Klöckner & Co SE on 8 of the 8 factors compared between the two stocks.

About Gerdau

Gerdau S.A., together with its subsidiaries, operates as a steel producer company. The company operates through Brazil Business, North America Business, South America Business, and Special Steel Business segments. It also provides semi-finished products, including billets, blooms, and slabs; common long rolled products, such as rebars, wire rods, merchant bars, light shapes, and profiles to the construction and manufacturing industries; drawn products comprising barbed and barbless fence wires, galvanized wires, fences, concrete reinforcing wire mesh, nails, and clamps for manufacturing, construction, and agricultural industries; and special steel products used in auto parts, light and heavy vehicles, and agricultural machinery, as well as in the oil and gas, wind energy, machinery and equipment, mining and rail, and other markets. In addition, the company offers flat products, such as hot-rolled steel coils and heavy plates; and resells flat steel products. Further, it operates mines that produce iron ore located in the Brazilian state of Minas Gerais. The company sells its products through independent distributors, direct sales from the mills, and its retail network. Gerdau S.A. was founded in 1901 and is based in São Paulo, Brazil.

About Klöckner & Co SE

Klöckner & Co SE, through its subsidiaries, distributes steel and metal products. The company operates through three segments: Kloeckner Metals Americas, Kloeckner Metals EU, and Kloeckner Metals Non-EU. It offers flat steel products; long steel products; tubes and hollow sections; stainless steel and high-grade steel; aluminum products; and CO2-reduced steel, stainless steel, and aluminum products for building installations, roof and wall construction, and water supply. The company also provides cutting and splitting of steel strips; forming and manufacturing of pressed parts; CNC turning/milling; 2D/3D tube laser cutting; laser and water jet cutting; structural steel processing; plasma and oxy-fuel cutting; shot blasting and primer painting; and sawing/drilling/rounding off services. In addition, it offers warehousing, logistics, and materials management services. The company serves small to medium-sized steel and metal consumers, including construction, machinery and mechanical engineering, transportation, and other metalworking companies. The company was founded in 1906 and is headquartered in Duisburg, Germany.