Comparing HeidelbergCement (HDELY) & CRH (CRH)

HeidelbergCement (OTCMKTS: HDELY) and CRH (NYSE:CRH) are both large-cap construction companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, earnings, profitability and dividends.

Analyst Recommendations

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This is a summary of recent ratings and price targets for HeidelbergCement and CRH, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
HeidelbergCement 0 3 6 0 2.67
CRH 0 0 6 0 3.00

CRH has a consensus target price of $32.50, suggesting a potential downside of 6.61%. Given CRH’s stronger consensus rating and higher probable upside, analysts clearly believe CRH is more favorable than HeidelbergCement.

Dividends

HeidelbergCement pays an annual dividend of $0.23 per share and has a dividend yield of 1.1%. CRH pays an annual dividend of $1.20 per share and has a dividend yield of 3.4%. HeidelbergCement pays out 18.3% of its earnings in the form of a dividend. CRH pays out 48.0% 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. CRH has increased its dividend for 2 consecutive years. CRH is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Insider & Institutional Ownership

0.1% of HeidelbergCement shares are held by institutional investors. Comparatively, 3.5% of CRH shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Profitability

This table compares HeidelbergCement and CRH’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
HeidelbergCement 5.31% 6.97% 3.27%
CRH N/A N/A N/A

Valuation & Earnings

This table compares HeidelbergCement and CRH’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
HeidelbergCement $19.50 billion 1.02 $1.20 billion $1.26 15.94
CRH $29.70 billion 0.98 $2.14 billion $2.50 13.92

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

Risk and Volatility

HeidelbergCement has a beta of 1.2, indicating that its stock price is 20% more volatile than the S&P 500. Comparatively, CRH has a beta of 0.92, indicating that its stock price is 8% less volatile than the S&P 500.

Summary

CRH beats HeidelbergCement on 8 of the 15 factors compared between the two stocks.

HeidelbergCement Company Profile

HeidelbergCement AG produces and distributes cement, aggregates, ready-mixed concrete, and asphalt worldwide. Its cement products include special cements with targeted characteristics, special geotechnical building materials, and a range of binders. The company offers natural stone and crushed aggregates, including sand, gravel, stone chippings, and crushed stones; concrete/ready-mixed concrete that is used for the production of precast concrete parts, such as stairs, ceiling elements, or structural components, as well as for use in the construction of tunnels or bridges, office buildings, and schools; and asphalt, which is primarily used in the building of traffic infrastructure comprising roads, walkways, and parking lots. It also trades in cement, clinker, solid fuels, and other building materials; and purchases and delivers coal and petroleum coke through sea routes to other cement companies. The company was founded in 1873 and is headquartered in Heidelberg, Germany.

CRH Company Profile

CRH plc, through its subsidiaries, manufactures and distributes building materials. It operates through six segments: Europe Heavyside, Europe Lightside, Europe Distribution, Americas Materials, Americas Products, and Asia. The company manufactures and supplies cement, aggregates, asphalt, lime, and readymixed concrete and concrete products; and construction accessories, network access and perimeter protection products, shutters and awnings, and architectural products. It also produces and sells concrete masonry and hardscapes, packaged lawn and garden products, packaged cement mixes, and glass and aluminum glazing systems, as well as fencing, utility, drainage, and structural precast products; and provides asphalt paving services. In addition, the company sells and distributes bricks, cement, sanitary, heating, plumbing, and other building products to small and medium-sized builders through 352 locations; general public through 198 retail locations; and plumbers, as well as heating, gas, water, and ventilation technicians through 134 showrooms. It operates primarily in Western Europe and North America, as well as in Eastern Europe, the Philippines, Brazil, China, and India. CRH plc was founded in 1936 and is headquartered in Dublin, Ireland.

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