Critical Analysis: National Steel (NYSE:SID) vs. ZK International Group (NASDAQ:ZKIN)

National Steel (NYSE:SID) and ZK International Group (NASDAQ:ZKIN) are both basic materials companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, earnings, dividends, analyst recommendations and valuation.

Analyst Ratings

This is a summary of current recommendations and price targets for National Steel and ZK International Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
National Steel	2	1	0	0	1.33
ZK International Group	1	0	0	0	1.00

National Steel currently has a consensus target price of $1.40, suggesting a potential downside of 26.51%. Given National Steel’s stronger consensus rating and higher possible upside, research analysts clearly believe National Steel is more favorable than ZK International Group.

Profitability

This table compares National Steel and ZK International Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
National Steel	-2.88%	-7.77%	-1.26%
ZK International Group	N/A	N/A	N/A

Risk and Volatility

National Steel has a beta of 1.67, meaning that its share price is 67% more volatile than the S&P 500. Comparatively, ZK International Group has a beta of 2.72, meaning that its share price is 172% more volatile than the S&P 500.

Valuation and Earnings

This table compares National Steel and ZK International Group”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
National Steel	$8.10 billion	0.31	-$480.53 million	($0.17)	-11.21
ZK International Group	$108.20 million	0.08	-$2.78 million	N/A	N/A

ZK International Group has lower revenue, but higher earnings than National Steel.

Institutional and Insider Ownership

0.3% of ZK International Group shares are owned by institutional investors. 0.0% of National Steel shares are owned by insiders. Comparatively, 29.8% of ZK International Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

ZK International Group beats National Steel on 7 of the 11 factors compared between the two stocks.

About National Steel

Companhia Siderúrgica Nacional operates as an integrated steel producer in Brazil and Latin America. It operates through five segments: Steel Industry, Mining, Logistics, Energy, and Cement. The company offers flat steel products, such as hot and cold rolled, galvanized, galvalume, pre-painted, and metal sheets products; coil, sheets, and derivatives; tiles and derivatives, pipes, and profiles; long steel products; steel packaging solutions for the food industry; chemical packaging solution; and carbochemical products. It also provides steel cutting services; produces and sells cement; operates railway and port facilities; and generates electric power from its thermoelectric co-generation and hydroelectric power plants. In addition, the company explores for iron ore reserves at Casa de Pedra and Engenho mines located in the city of Congonhas; and limestone and dolomite at the Bocaina mine located in the city of Arcos in the state of Minas Gerais, Brazil, as well as produces tin. Companhia Siderúrgica Nacional was founded in 1941 and is headquartered in São Paulo, Brazil.

About ZK International Group

ZK International Group Co., Ltd., through its subsidiaries, engages in the designing, producing, and selling double-press thin-walled stainless steel, carbon steel, and single-press tubes and fittings in the People's Republic of China. It offers carbon and stainless steel strips; carbon and stainless steel pipes; light gauge stainless steel pipes; pipe connections and fittings; and couplings, unions, adapters, caps, plug pipes, elbows, three-way fittings, tees, cross, side-inlet elbows, wyes, reducers, bushings, pipe fasteners, and pipe flanges. The company also provides stainless steel band, copper strip, valve, light industry machinery and equipment, and other stainless steel products. Its products are used in various applications, including water and gas transmission within urban infrastructural development, residential housing development, food and beverage production, oil and gas exploitation, and agricultural irrigation. The company also exports its products to Europe, Africa, and Southeast Asia. ZK International Group Co., Ltd. was incorporated in 2015 and is based in Wenzhou, the People's Republic of China.