James Hardie Industries (NYSE: JHX) and Forterra (NASDAQ:FRTA) are both construction companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, risk, earnings, analyst recommendations, valuation, dividends and institutional ownership.
Volatility and Risk
James Hardie Industries has a beta of 1.08, indicating that its share price is 8% more volatile than the S&P 500. Comparatively, Forterra has a beta of 0.71, indicating that its share price is 29% less volatile than the S&P 500.
0.5% of James Hardie Industries shares are held by institutional investors. 0.3% of Forterra shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Earnings and Valuation
This table compares James Hardie Industries and Forterra’s revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|James Hardie Industries||$1.92 billion||4.14||$276.50 million||N/A||N/A|
|Forterra||$1.58 billion||0.34||-$2.06 million||($0.79)||-10.52|
James Hardie Industries has higher revenue and earnings than Forterra.
This is a summary of current recommendations and price targets for James Hardie Industries and Forterra, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|James Hardie Industries||0||0||3||0||3.00|
Forterra has a consensus target price of $12.29, suggesting a potential upside of 47.84%. Given Forterra’s higher possible upside, analysts clearly believe Forterra is more favorable than James Hardie Industries.
This table compares James Hardie Industries and Forterra’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|James Hardie Industries||12.27%||-116.69%||11.90%|
James Hardie Industries pays an annual dividend of $0.28 per share and has a dividend yield of 1.6%. Forterra does not pay a dividend. James Hardie Industries has raised its dividend for 4 consecutive years.
James Hardie Industries beats Forterra on 12 of the 15 factors compared between the two stocks.
About James Hardie Industries
James Hardie Industries plc, together with its subsidiaries, manufactures and sells fiber cement products. It operates through four segments: North America Fiber Cement, International Fiber Cement, Other Business, and Research and Development. The company offers fiber cement interior linings, fiberglass windows, exterior siding products, and related accessories products. Its fiber cement products are used in various markets, including new residential construction, manufactured housing, repair and remodeling, and commercial and industrial applications. James Hardie Industries plc was founded in 1888 and is headquartered in Dublin, Ireland.
Forterra, Inc. manufactures and sells water and drainage pipe and products in the United States and Eastern Canada. It also manufactures structural and specialty precast products, and precast concrete bridge girders; and pressure, prestressed concrete, and bar-wrapped concrete pipes. The company serves water-related infrastructure applications, including water transmission, distribution, and drainage; and contractors, distributors, municipalities, and utilities waterworks. Forterra, Inc. was founded in 2016 and is headquartered in Irving, Texas.
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