Financial Review: DPM Metals (OTCMKTS:DPMLF) & Salzgitter (OTCMKTS:SZGPY)

Salzgitter (OTCMKTS:SZGPY) and DPM Metals (OTCMKTS:DPMLF) are both mid-cap materials companies, but which is the superior stock? We will compare the two businesses based on the strength of their earnings, analyst recommendations, valuation, risk, dividends, institutional ownership and profitability.

Analyst Ratings

This is a summary of recent ratings for Salzgitter and DPM Metals, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Salzgitter	0	2	5	0	2.71
DPM Metals	0	2	3	0	2.60

Valuation and Earnings

This table compares Salzgitter and DPM Metals”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Salzgitter	$10.16 billion	0.29	-$83.95 million	$0.12	45.58
DPM Metals	$950.48 million	9.60	$369.23 million	$3.04	13.69

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

Dividends

Salzgitter pays an annual dividend of $0.01 per share and has a dividend yield of 0.2%. DPM Metals pays an annual dividend of $0.16 per share and has a dividend yield of 0.4%. Salzgitter pays out 8.3% of its earnings in the form of a dividend. DPM Metals pays out 5.3% 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. DPM Metals is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility & Risk

Salzgitter has a beta of 1.7, indicating that its share price is 70% more volatile than the S&P 500. Comparatively, DPM Metals has a beta of 0.7, indicating that its share price is 30% less volatile than the S&P 500.

Profitability

This table compares Salzgitter and DPM Metals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Salzgitter	0.65%	1.29%	0.54%
DPM Metals	50.26%	25.66%	21.67%

Summary

DPM Metals beats Salzgitter on 8 of the 13 factors compared between the two stocks.

About Salzgitter

Salzgitter AG, together with its subsidiaries, engages in steel and technology businesses worldwide. It operates through four segments: Steel Production, Steel Processing, Trading, and Technology. The Steel Production segment manufactures steel and special steels, such as hot-rolled wide strip, steel sheet, sections, tailored blanks, as well as scrap trading. The Steel Processing segment produces various high-grade heavy plates; and manufactures line pipes, HFI-welded tubes, and precision and stainless-steel tubes. The Trading segment operates a European sales network, as well as trading companies and agencies worldwide. The Technology segment engages in the provision of machinery and plants for the filling and packaging of beverages, as well as special machinery engineering for shoe manufacturing and elastomer production. The company also provides IT, facility management, logistics, automotive engineering, and research and development services, as well as supplies raw materials. The company was founded in 1858 and is headquartered in Salzgitter, Germany.

About DPM Metals

Dundee Precious Metals Inc., a gold mining company, engages in the acquisition, exploration, development, mining, and processing of precious metals. The company primarily explores for gold, copper, and silver deposits. It holds a portfolio of projects located in Bulgaria, Namibia, Serbia, and Ecuador. The company is based in Toronto, Canada.