Stantec (STN) & Foster Wheeler (FWLT) Critical Survey

Stantec (NYSE: STN) and Foster Wheeler (NASDAQ:FWLT) are both industrials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, institutional ownership, earnings, dividends, profitability and risk.

Profitability

This table compares Stantec and Foster Wheeler’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Stantec 2.24% 10.69% 5.03%
Foster Wheeler N/A N/A N/A

Dividends

Stantec pays an annual dividend of $0.40 per share and has a dividend yield of 1.5%. Foster Wheeler does not pay a dividend. Stantec pays out 50.6% of its earnings in the form of a dividend. Foster Wheeler has increased its dividend for 4 consecutive years.

Valuation & Earnings

This table compares Stantec and Foster Wheeler’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Stantec $3.22 billion 0.97 $98.59 million $0.79 34.87
Foster Wheeler N/A N/A N/A $0.90 N/A

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

Insider & Institutional Ownership

54.4% of Stantec shares are owned by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Stantec and Foster Wheeler, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Stantec 0 1 2 0 2.67
Foster Wheeler 0 0 0 0 N/A

Stantec presently has a consensus target price of $40.00, suggesting a potential upside of 45.19%.

Summary

Stantec beats Foster Wheeler on 7 of the 10 factors compared between the two stocks.

Stantec Company Profile

Stantec Inc. is a provider of professional services in the area of infrastructure and facilities for clients in the public and private sectors. The Company’s operates through four segments Consulting Services-Canada, Consulting Services-United States, Consulting Services-Global and Construction Services. The Company’s services include engineering, architecture, interior design, landscape architecture, surveying, environmental sciences, construction services, project management, and project economics, from initial project concept and planning through to design, construction, commissioning, maintenance, decommissioning and remediation. The Company provides professional consulting services in engineering, architecture, interior design, landscape architecture, surveying, environmental services, project management and project economics in the area of infrastructure and facilities, principally under fee-for-service agreements with clients.

Foster Wheeler Company Profile

Foster Wheeler AG (Foster Wheeler) is a supplier of engineering, construction and project management contractor and power equipment. It operates through two business groups: Global Engineering and Construction Group (Global E&C Group), and Global Power Group. Its Global E&C Group, which operates worldwide, designs, engineers and constructs onshore and offshore upstream oil and gas processing facilities, natural gas liquefaction facilities and receiving terminals, gas-to-liquids facilities, oil refining, chemical and petrochemical, pharmaceutical and biotechnology facilities and related infrastructure. Its Global Power Group designs, manufactures and erects steam generators and auxiliary equipment for electric power generating stations, district heating and power plants and industrial facilities worldwide.In May 2014, the Company announced that a subsidiary of its Global Power Group acquired Siemens Environmental Systems and Services business.

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