Foundation Building Materials (NYSE: FBM) and Beacon Roofing Supply (NASDAQ:BECN) are both construction companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, dividends, valuation, profitability, risk, analyst recommendations and institutional ownership.
Valuation & Earnings
This table compares Foundation Building Materials and Beacon Roofing Supply’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Foundation Building Materials||$2.06 billion||0.30||$82.48 million||$0.30||48.03|
|Beacon Roofing Supply||$4.38 billion||0.77||$100.86 million||$2.18||22.61|
This is a breakdown of recent ratings and price targets for Foundation Building Materials and Beacon Roofing Supply, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Foundation Building Materials||0||1||4||2||3.14|
|Beacon Roofing Supply||0||2||7||0||2.78|
Foundation Building Materials currently has a consensus price target of $17.83, suggesting a potential upside of 23.76%. Beacon Roofing Supply has a consensus price target of $61.11, suggesting a potential upside of 23.98%. Given Beacon Roofing Supply’s higher probable upside, analysts clearly believe Beacon Roofing Supply is more favorable than Foundation Building Materials.
Institutional and Insider Ownership
94.7% of Foundation Building Materials shares are held by institutional investors. 0.5% of Foundation Building Materials shares are held by insiders. Comparatively, 0.8% of Beacon Roofing Supply shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
This table compares Foundation Building Materials and Beacon Roofing Supply’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Foundation Building Materials||4.00%||2.44%||0.58%|
|Beacon Roofing Supply||3.29%||9.60%||4.21%|
Volatility & Risk
Foundation Building Materials has a beta of 0.3, meaning that its share price is 70% less volatile than the S&P 500. Comparatively, Beacon Roofing Supply has a beta of 1.39, meaning that its share price is 39% more volatile than the S&P 500.
Beacon Roofing Supply beats Foundation Building Materials on 10 of the 15 factors compared between the two stocks.
Foundation Building Materials Company Profile
Foundation Building Materials, Inc. distributes building products in the United States and Canada. It operates through two segments, Specialty Building Products and Mechanical Insulation. The Specialty Building Products segment distributes wallboard, metal framing, suspended ceiling system, and other products. It also provides wallboard accessories, stucco, and exterior insulation and finish systems, as well as tools, safety accessories, and fasteners. This segment serves non-residential, residential, and non-residential repair and remodel construction markets. The Mechanical Insulation segment distributes and fabricates commercial and industrial insulation for pipes and mechanical systems. It serves non-residential construction, non-residential repair and remodel construction, and industrial markets. The company was founded in 2011 and is headquartered in Tustin, California. Foundation Building Materials, Inc. is a subsidiary of LSF9 Cypress Parent 2 LLC.
Beacon Roofing Supply Company Profile
Beacon Roofing Supply, Inc., together with its subsidiaries, distributes residential and commercial roofing materials, and other complementary building materials to contractors, home builders, retailers, and building materials suppliers. The company's residential roofing products include asphalt shingles, synthetic slates and tiles, clay and concrete tiles, slates, nail base insulations, metal roofing, felts, synthetic underlayment, wood shingles and shakes, nails and fasteners, metal edgings and flashings, prefabricated flashings, ridges and soffit vents, and other accessories. Its non-residential roofing products comprise single-ply roofing, asphalt, metal, modified bitumen, and build-up roofing products; cements and coatings; flat stock and tapered insulations; commercial fasteners; metal edges and flashings; smoke/roof hatches; roofing tools; sheet metal products, including copper, aluminum, and steel; and PVC, thermoplastic olefin, and ethylene propylene diene monomer membrane products. The company also provides complementary building products, such as vinyl, wood, and fiber cement sidings; and stone veneers, windows, doors, skylights, and gutters and downspouts, as well as decking and railing, sealants, air barriers, water proofing, building insulation, concrete restoration systems, and millwork products. In addition, it offers value-added services, including advice and assistance on product identification, specification, and technical support; job site delivery, rooftop loading, and logistical services; tapered insulation design and related layout services; metal fabrication and related metal roofing design and layout services; trade credit; and marketing support for contractors. As of November 20, 2017, the company operated through a network of 383 branches in 48 states of the United States and 6 provinces in Canada. Beacon Roofing Supply, Inc. was founded in 1928 and is headquartered in Herndon, Virginia.
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