Head-To-Head Contrast: Allegheny Technologies (ATI) versus Materion Corporation (MTRN)

Allegheny Technologies (NYSE: ATI) and Materion Corporation (NYSE:MTRN) are both basic materials companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, profitability, earnings, risk, analyst recommendations, institutional ownership and dividends.

Institutional and Insider Ownership

90.8% of Materion Corporation shares are held by institutional investors. 1.1% of Allegheny Technologies shares are held by insiders. Comparatively, 2.9% of Materion Corporation shares are held by 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

Materion Corporation pays an annual dividend of $0.40 per share and has a dividend yield of 0.8%. Allegheny Technologies does not pay a dividend. Materion Corporation pays out 30.8% of its earnings in the form of a dividend. Materion Corporation has increased its dividend for 4 consecutive years.

Profitability

This table compares Allegheny Technologies and Materion Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Allegheny Technologies -2.45% 1.09% 0.31%
Materion Corporation 2.48% 6.08% 3.96%

Valuation and Earnings

This table compares Allegheny Technologies and Materion Corporation’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Allegheny Technologies $3.13 billion 0.76 -$640.90 million ($0.78) -28.23
Materion Corporation $969.24 million 1.07 $25.74 million $1.30 39.65

Materion Corporation has higher revenue, but lower earnings than Allegheny Technologies. Allegheny Technologies is trading at a lower price-to-earnings ratio than Materion Corporation, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Allegheny Technologies and Materion Corporation, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Allegheny Technologies 0 5 3 0 2.38
Materion Corporation 0 1 0 0 2.00

Allegheny Technologies currently has a consensus price target of $20.57, indicating a potential downside of 6.58%. Materion Corporation has a consensus price target of $36.00, indicating a potential downside of 30.16%. Given Allegheny Technologies’ stronger consensus rating and higher possible upside, equities research analysts plainly believe Allegheny Technologies is more favorable than Materion Corporation.

Volatility and Risk

Allegheny Technologies has a beta of 2.44, meaning that its stock price is 144% more volatile than the S&P 500. Comparatively, Materion Corporation has a beta of 1.11, meaning that its stock price is 11% more volatile than the S&P 500.

Summary

Materion Corporation beats Allegheny Technologies on 10 of the 17 factors compared between the two stocks.

Allegheny Technologies Company Profile

Allegheny Technologies Incorporated is a manufacturer of specialty materials and complex components. The Company operates through two business segments: High Performance Materials & Components (HPMC), and Flat Rolled Products (FRP). The HPMC segment produces, converts and distributes a range of materials, including titanium and titanium-based alloys, nickel- and cobalt-based alloys and superalloys, zirconium and related alloys, including hafnium and niobium, advanced powder alloys and other specialty materials, in long product forms, such as ingot, billet, bar, rod, wire, shapes and rectangles, and seamless tubes, plus precision forgings, castings, components and machined parts. The FRP segment produces, converts and distributes stainless steel, nickel-based alloys, specialty alloys, and titanium and titanium-based alloys, in a range of product forms, including plate, sheet, engineered strip, and Precision Rolled Strip products.

Materion Corporation Company Profile

Materion Corporation, through its subsidiaries, is an integrated producer of engineered materials used in a range of electrical, electronic, thermal, and structural applications. The Company operates in four segments: Performance Alloys and Composites, Advanced Materials, Precision Coatings, and Other. The Performance Alloys and Composites segment consists of businesses, such as Performance Metals and Technical Materials. The Advanced Materials segment produces chemicals, microelectronics packaging, precious metal, non-precious metal and specialty metal products. The Precision Coatings segment includes units, such as Precision Optics and Large Area Coatings. Its products include inorganic chemicals and powders, specialty coatings, specialty engineered beryllium and copper-based alloys, beryllium composites, ceramics and engineered clad, and plated metal systems.

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