Financial Comparison: Quanex Building Products Corporation (NX) vs. Valmont Industries (VMI)

Valmont Industries (NYSE: VMI) and Quanex Building Products Corporation (NYSE:NX) are both industrial products companies, but which is the better stock? We will compare the two companies based on the strength of their risk, valuation, dividends, analyst recommendations, profitability, institutional ownership and earnings.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Valmont Industries and Quanex Building Products Corporation, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Valmont Industries 0 0 0 0 N/A
Quanex Building Products Corporation 0 1 0 0 2.00

Institutional and Insider Ownership

84.8% of Valmont Industries shares are owned by institutional investors. Comparatively, 99.3% of Quanex Building Products Corporation shares are owned by institutional investors. 3.3% of Valmont Industries shares are owned by company insiders. Comparatively, 5.3% of Quanex Building Products Corporation shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Valmont Industries and Quanex Building Products Corporation’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Valmont Industries $2.52 billion 1.44 $173.23 million $8.38 19.20
Quanex Building Products Corporation $928.18 million 0.76 -$1.85 million $0.38 53.95

Valmont Industries has higher revenue and earnings than Quanex Building Products Corporation. Valmont Industries is trading at a lower price-to-earnings ratio than Quanex Building Products Corporation, indicating that it is currently the more affordable of the two stocks.

Dividends

Valmont Industries pays an annual dividend of $1.50 per share and has a dividend yield of 0.9%. Quanex Building Products Corporation pays an annual dividend of $0.16 per share and has a dividend yield of 0.8%. Valmont Industries pays out 17.9% of its earnings in the form of a dividend. Quanex Building Products Corporation pays out 42.1% 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. Valmont Industries is clearly the better dividend stock, given its higher yield and lower payout ratio.

Volatility & Risk

Valmont Industries has a beta of 1.03, meaning that its stock price is 3% more volatile than the S&P 500. Comparatively, Quanex Building Products Corporation has a beta of 0.7, meaning that its stock price is 30% less volatile than the S&P 500.

Profitability

This table compares Valmont Industries and Quanex Building Products Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Valmont Industries 7.02% 14.56% 6.24%
Quanex Building Products Corporation 1.52% 7.87% 3.81%

Summary

Valmont Industries beats Quanex Building Products Corporation on 10 of the 13 factors compared between the two stocks.

About Valmont Industries

Valmont Industries, Inc. is a producer of fabricated metal products, and steel, aluminum and composite pole, tower and other structures, and mechanized irrigation systems. The Company’s segments are Engineered Support Structures (ESS); Utility Support Structures; Energy and Mining; Coatings; Irrigation, and Other. The ESS segment manufactures steel, aluminum, and composite poles and structures. The Utility Support Structures Segment manufactures steel and concrete pole structures for electrical transmission, substation and distribution applications. The Energy and Mining Segment produces access systems, which are engineered structures and components that allow people to move safely in an industrial, infrastructure or commercial facility. The Coatings Segment consists of galvanizing, anodizing and powder coating services on a global basis. The Irrigation Segment manufactures and distributes mechanical irrigation equipment and related service parts under the Valley brand name.

About Quanex Building Products Corporation

Quanex Building Products Corporation manufactures components for original equipment manufacturers (OEM) in the building products industry. The Company’s components can be categorized as window and door (fenestration) components, and kitchen and bath cabinet components. The Company operates through three segments: North American Engineered Components (NA Engineered Components), which consists of four operating segments primarily focused on the fenestration market in North America manufacturing vinyl profiles, insulating glass (IG) spacers, screens and other fenestration components; European Engineered Components (EU Engineered Components), which consists of the United Kingdom-based vinyl extrusion business, manufacturing vinyl profiles and conservatories, and the European insulating glass business manufacturing IG spacers, and North American Cabinet Components (NA Cabinet Components), which consists of the North American cabinet door and components business.

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