Ferroglobe (NASDAQ:GSM – Get Free Report) and Sigma Lithium (NASDAQ:SGML – Get Free Report) are both basic materials companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, analyst recommendations, valuation, profitability, institutional ownership, risk and earnings.
Insider & Institutional Ownership
44.5% of Ferroglobe shares are held by institutional investors. Comparatively, 22.9% of Sigma Lithium shares are held by institutional investors. 13.1% of Ferroglobe shares are held by insiders. Comparatively, 48.6% of Sigma Lithium shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Earnings & Valuation
This table compares Ferroglobe and Sigma Lithium’s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Ferroglobe | $2.60 billion | 0.36 | $440.31 million | $1.74 | 2.90 |
| Sigma Lithium | N/A | N/A | -$97.85 million | ($0.87) | -44.67 |
Risk and Volatility
Ferroglobe has a beta of 2.2, meaning that its share price is 120% more volatile than the S&P 500. Comparatively, Sigma Lithium has a beta of 0.32, meaning that its share price is 68% less volatile than the S&P 500.
Profitability
This table compares Ferroglobe and Sigma Lithium’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Ferroglobe | 14.42% | 60.74% | 21.91% |
| Sigma Lithium | N/A | -60.76% | -50.08% |
Analyst Recommendations
This is a breakdown of current ratings for Ferroglobe and Sigma Lithium, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Ferroglobe | 0 | 0 | 1 | 0 | 3.00 |
| Sigma Lithium | 0 | 0 | 2 | 0 | 3.00 |
Ferroglobe presently has a consensus target price of $11.00, indicating a potential upside of 117.82%. Sigma Lithium has a consensus target price of $52.00, indicating a potential upside of 33.81%. Given Ferroglobe’s higher probable upside, equities analysts clearly believe Ferroglobe is more favorable than Sigma Lithium.
Summary
Ferroglobe beats Sigma Lithium on 10 of the 12 factors compared between the two stocks.
About Ferroglobe
Ferroglobe PLC operates in the silicon and specialty metals industry in the United States, Europe, and internationally. It provides silicone chemicals that are used in a range of applications, including personal care items, construction-related products, health care products, and electronics, as well as silicon metal for primary and secondary aluminum producers; silicomanganese, which is used as deoxidizing agent in the steel manufacturing process; and ferromanganese that is used as a deoxidizing, desulphurizing, and degassing agent in the removal of nitrogen and other harmful elements from steel. The company also offers ferrosilicon products that are used to produce stainless steel, carbon steel, and various other steel alloys, as well as to manufacture electrodes and aluminum; calcium silicon, which is used in the deoxidation and desulfurization of liquid steel, and production of coatings for cast iron pipes, as well as in the welding process of powder metal and in pyrotechnics; and nodularizers and inoculants, which are used in the production of iron. In addition, it provides silica fume, a by-product of the electrometallurgical process of silicon metal and ferrosilicon. Further, the company operates quartz mines in South Africa, Spain, the United States, and Canada; and low-ash metallurgical coal mines in the United States, as well as holds interests in hydroelectric power plant in France. It serves silicone chemical, aluminum, and steel manufacturers; auto companies and their suppliers; ductile iron foundries; manufacturers of photovoltaic solar cells and computer chips; and concrete producers. The company was formerly known as VeloNewco Limited and changed its name to Ferroglobe PLC in December 2015. The company was incorporated in 2015 and is headquartered in London, the United Kingdom.
About Sigma Lithium
Sigma Lithium Corporation engages in the exploration and development of lithium deposits in Brazil. It holds a 100% interest in the Grota do Cirilo, Genipapo, Santa Clara, and São José properties comprising 29 mineral rights covering an area of approximately 185 square kilometers located in the Araçuaí and Itinga regions of the state of Minas Gerais, Brazil. It serves electric vehicle industries worldwide. The company was formerly known as Sigma Lithium Resources Corporation and changed its name to Sigma Lithium Corporation in July 2021. The company is headquartered in São Paulo, Brazil.
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