Alcoa (AA) vs Ternium S.A. (TX)

Alcoa and Ternium S.A. are both in the Basic Materials sector (Aluminum and Steel). Alcoa and Ternium S.A. are of similar size ($10.1B and $9.6B). Alcoa trades at the lower P/E: 6.6× against 9.1×. Alcoa grew revenue faster over the last twelve months: 11.2% against 6.25%. Alcoa has the higher net margin (10.7% vs 5.74%) and the higher return on invested capital (13.8% vs 5.65%). Both pay a dividend; Ternium S.A. yields more (4.51% vs 1.04%). Across the 22 metrics below, Alcoa leads on 14 and Ternium S.A. on 8.

Valuation

Metric AA TX
P/E 6.61 9.14
P/S 0.71 0.57
P/B 1.24 0.57
Price to free cash flow 11.32 n/m
EV/EBITDA 3.89 4.92
EV/Sales 0.74 0.58
Earnings yield 15.13% 10.94%
Free cash flow yield 8.83% (0.88%)

Profitability

Metric AA TX
Gross margin 21.93% 19.57%
Operating margin 13.33% 9.31%
Net margin 10.68% 5.74%
Free cash flow margin 6.29% (0.50%)
Return on equity 20.82% 0.00%
Return on assets 8.41% 3.93%
Return on invested capital 13.77% 5.65%

Growth

Metric AA TX
Revenue growth (TTM) 11.22% 6.25%
EPS growth (last fiscal year) 1,600.00% 903.70%
Revenue growth, 5-year CAGR 6.68% 12.31%
Net income growth, 5-year CAGR 0.00% (11.39%)

Health

Metric AA TX
Debt to equity 0.58 0.19
Current ratio 2.31 2.55
Net debt to EBITDA 0.90 (0.41)

Dividend

Metric AA TX
Dividend yield 1.04% 4.51%
Payout ratio 0.07 0.41

Size

Metric AA TX
Market cap 10.14b 9.55b

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