Comparing Worthington Steel (NYSE:WS) and Alamos Gold (NYSE:AGI)

Worthington Steel (NYSE:WS) and Alamos Gold (NYSE:AGI) are both materials companies, but which is the better business? We will compare the two businesses based on the strength of their earnings, dividends, valuation, institutional ownership, profitability, risk and analyst recommendations.

Analyst Ratings

This is a summary of recent recommendations and price targets for Worthington Steel and Alamos Gold, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Worthington Steel	1	1	1	0	2.00
Alamos Gold	0	1	8	0	2.89

Worthington Steel presently has a consensus target price of $46.00, suggesting a potential upside of 27.49%. Alamos Gold has a consensus target price of $47.50, suggesting a potential upside of 52.43%. Given Alamos Gold’s stronger consensus rating and higher probable upside, analysts plainly believe Alamos Gold is more favorable than Worthington Steel.

Profitability

This table compares Worthington Steel and Alamos Gold’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Worthington Steel	-0.56%	7.49%	3.14%
Alamos Gold	46.66%	18.95%	13.43%

Dividends

Worthington Steel pays an annual dividend of $0.64 per share and has a dividend yield of 1.8%. Alamos Gold pays an annual dividend of $0.16 per share and has a dividend yield of 0.5%. Worthington Steel pays out -104.9% of its earnings in the form of a dividend. Alamos Gold pays out 6.4% 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. Worthington Steel is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility and Risk

Worthington Steel has a beta of 2.12, meaning that its stock price is 112% more volatile than the S&P 500. Comparatively, Alamos Gold has a beta of 0.63, meaning that its stock price is 37% less volatile than the S&P 500.

Earnings & Valuation

This table compares Worthington Steel and Alamos Gold”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Worthington Steel	$3.44 billion	0.54	$8.50 million	($0.61)	-59.15
Alamos Gold	$1.81 billion	7.21	$885.80 million	$2.51	12.42

Alamos Gold has lower revenue, but higher earnings than Worthington Steel. Worthington Steel is trading at a lower price-to-earnings ratio than Alamos Gold, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

45.4% of Worthington Steel shares are owned by institutional investors. Comparatively, 64.3% of Alamos Gold shares are owned by institutional investors. 2.7% of Worthington Steel shares are owned by company insiders. Comparatively, 0.5% of Alamos Gold shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Alamos Gold beats Worthington Steel on 11 of the 16 factors compared between the two stocks.

About Worthington Steel

Worthington Steel, Inc. operates as a steel processor in North America. It offers carbon flat-rolled steel and tailor welded blanks, as well as electrical steel laminations; and aluminum tailor welded blanks. The company serves various end-markets, including automotive, heavy truck, agriculture, construction, and energy. Worthington Steel, Inc. was incorporated in 2023 and is based in Columbus, Ohio.

About Alamos Gold

Alamos Gold Inc. engages in the acquisition, exploration, development, and extraction of precious metals in Canada and Mexico. The company primarily explores for gold deposits. It holds 100% interest in the Young-Davidson mine and Island Gold mine located in the Ontario, Canada; Mulatos mine located in the Sonora, Mexico; and Lynn Lake project situated in the Manitoba, Canada. The company also holds interest in the Quartz Mountain project located in the Oregon United states. Alamos Gold Inc. was founded in 2003 and is based in Toronto, Canada.