L.B. Foster (NASDAQ:FSTR – Get Free Report) and Algoma Steel Group (NASDAQ:ASTL – Get Free Report) are both small-cap basic materials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, valuation, dividends, earnings and risk.
Valuation & Earnings
This table compares L.B. Foster and Algoma Steel Group”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| L.B. Foster | $530.77 million | 0.56 | $42.95 million | $0.45 | 63.11 |
| Algoma Steel Group | $2.07 billion | 0.22 | -$62.28 million | ($4.75) | -0.89 |
Volatility & Risk
L.B. Foster has a beta of 1, meaning that its share price has a similar volatility profile to the S&P 500.Comparatively, Algoma Steel Group has a beta of 1.56, meaning that its share price is 56% more volatile than the S&P 500.
Analyst Recommendations
This is a summary of recent ratings and price targets for L.B. Foster and Algoma Steel Group, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| L.B. Foster | 1 | 2 | 1 | 0 | 2.00 |
| Algoma Steel Group | 1 | 4 | 0 | 0 | 1.80 |
L.B. Foster currently has a consensus price target of $25.00, indicating a potential downside of 11.97%. Given L.B. Foster’s stronger consensus rating and higher probable upside, equities research analysts plainly believe L.B. Foster is more favorable than Algoma Steel Group.
Profitability
This table compares L.B. Foster and Algoma Steel Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| L.B. Foster | 0.96% | 2.79% | 1.44% |
| Algoma Steel Group | -31.27% | -15.13% | -6.51% |
Insider & Institutional Ownership
80.6% of L.B. Foster shares are owned by institutional investors. Comparatively, 72.0% of Algoma Steel Group shares are owned by institutional investors. 4.7% of L.B. Foster shares are owned by insiders. Comparatively, 7.8% of Algoma Steel Group shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.
Summary
L.B. Foster beats Algoma Steel Group on 11 of the 14 factors compared between the two stocks.
About L.B. Foster
L.B. Foster Company provides engineered and manufactured products and services for the building and infrastructure projects in the United States, Canada, the United Kingdom, and internationally. It operates through two segments: Rail, Technologies, and Services; and Infrastructure Solutions. The Rail, Technologies, and Services segment offers new rail to passenger and short line freight railroads, industrial companies, and rail contractors, as well as used rails; rail accessories, such as rack spikes, bolts, angle bars, tie plates, and other products; insulated rail joints and related accessories; fixation fasteners, coverboards, and special accessories; and trackwork products. This segment also provides engineered concrete railroad ties, friction management products and application systems, railroad condition monitoring systems and equipment including wheel impact load detection systems, wayside data collection and management systems, and rockfall, flood, earthworks, and bridge strike monitoring; and aftermarket services. The Infrastructure Solutions segment manufactures precast concrete products for use as restrooms, concession stands, and protective storage buildings under the CXT brand for national, state, and municipal parks; and manufactures sounds walls, bridge beams, box culverts, septic tanks, and other custom pre-stressed and precast concrete products. This segment also provides steel bridge products; corrosion protection solutions; concrete-reinforced steel grid decking, open steel grid deck, aluminum bridge railing, and stay-in-place steel bridge forms; cuts, threads, and paints pipe; threading services for water well applications; protective pipeline coating services; and turnkey solutions for metering and injection systems for oil and gas markets. L.B. Foster Company was founded in 1902 and is headquartered in Pittsburgh, Pennsylvania.
About Algoma Steel Group
Algoma Steel Group Inc. produces and sells steel products primarily in North America. The company provides flat/sheet steel products, including temper rolling, cold rolled, hot-rolled pickled and oiled products, floor plate, and cut-to-length products for the automotive industry, hollow structural product manufacturers, and the light manufacturing and transportation industries; and plate steel products that consist of rolled, hot-rolled, and heat-treated for use in the construction or manufacture of railcars, buildings, bridges, off-highway equipment, storage tanks, ships, and military applications. Algoma Steel Group Inc. was founded in 1901 and is headquartered in Sault Ste. Marie, Canada.
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