Critical Analysis: Outokumpu (OTCMKTS:OUTKY) and FAT Brands (NASDAQ:FATBB)

FAT Brands (NASDAQ:FATBB) and Outokumpu (OTCMKTS:OUTKY) are both materials companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, dividends, profitability, institutional ownership, analyst recommendations and risk.

Earnings & Valuation

This table compares FAT Brands and Outokumpu”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FAT Brands	$574.14 million	0.03	-$189.85 million	($13.35)	-0.07
Outokumpu	$6.19 billion	0.50	-$155.00 million	($0.10)	-32.95

Outokumpu has higher revenue and earnings than FAT Brands. Outokumpu is trading at a lower price-to-earnings ratio than FAT Brands, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares FAT Brands and Outokumpu’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FAT Brands	-39.33%	N/A	-17.57%
Outokumpu	-1.48%	-2.38%	-1.41%

Dividends

FAT Brands pays an annual dividend of $0.14 per share and has a dividend yield of 15.8%. Outokumpu pays an annual dividend of $0.02 per share and has a dividend yield of 0.6%. FAT Brands pays out -1.0% of its earnings in the form of a dividend. Outokumpu pays out -20.0% 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.

Volatility and Risk

FAT Brands has a beta of 1.03, meaning that its stock price is 3% more volatile than the S&P 500. Comparatively, Outokumpu has a beta of 0.72, meaning that its stock price is 28% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for FAT Brands and Outokumpu, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FAT Brands	1	0	0	0	1.00
Outokumpu	0	4	2	0	2.33

Summary

Outokumpu beats FAT Brands on 9 of the 13 factors compared between the two stocks.

About FAT Brands

FAT Brands Inc., a multi-brand restaurant franchising company, acquires, develops, markets, and manages quick service, fast casual, casual dining, and polished casual dining restaurant concepts worldwide. It owns restaurant brands, including Round Table Pizza, Marble Slab Creamery, Great American Cookies, Hot Dog on a Stick, Pretzelmaker, Fazoli's, Fatburger, Johnny Rockets, Elevation Burger, Yalla Mediterranean, Buffalo's Cafe and Buffalo's Express, Hurricane Grill & Wings, Ponderosa Steakhouse/Bonanza Steakhouse, Native Grill & Wings, Smokey Bones, and Twin Peaks. The company was incorporated in 2017 and is headquartered in Beverly Hills, California. FAT Brands Inc. is a subsidiary of Fog Cutter Holdings, LLC.

About Outokumpu

Outokumpu Oyj produces and sells various stainless steel products in Finland, other European countries, North America, the Asia-Pacific, and internationally. The company operates through three segments: Europe, Americas, and Ferrochrome. It offers cold rolled coils, strips, and sheets; hot rolled coils, strips, and plates; quarto plates; precision strips; and specialized components, such as welded stainless-steel I-beams, H-beams, hollow-section tubes, bent profiles, structural sections, hardened and customized press plates, suction roll shells, and blancs and disks. The company also provides stainless steel powder which includes Supra 316L, Dura 17-4PH, Ultra 904L, Therma 253MA, Dura 4116, and Ni-free austenitic stainless steel powder; and nickel-based alloys. Its products are used in various applications, including commercial kitchen, cooking, food industry, and home appliances; automotive and transportation; building and infrastructure; energy; marine; and heavy industries. The company was founded in 1910 and is headquartered in Helsinki, Finland.