Financial Comparison: Masco (NYSE:MAS) and Obayashi (OTCMKTS:OBYCF)

Obayashi (OTCMKTS:OBYCF) and Masco (NYSE:MAS) are both large-cap construction companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, institutional ownership, dividends, risk, earnings, analyst recommendations and profitability.

Profitability

This table compares Obayashi and Masco’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Obayashi	5.35%	7.36%	2.92%
Masco	10.89%	1,317.38%	16.47%

Risk and Volatility

Obayashi has a beta of 0.34, meaning that its stock price is 66% less volatile than the S&P 500. Comparatively, Masco has a beta of 1.17, meaning that its stock price is 17% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings for Obayashi and Masco, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Obayashi	0	0	0	0	0.00
Masco	0	13	6	1	2.40

Masco has a consensus target price of $73.53, indicating a potential upside of 18.81%. Given Masco’s stronger consensus rating and higher probable upside, analysts clearly believe Masco is more favorable than Obayashi.

Earnings and Valuation

This table compares Obayashi and Masco”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Obayashi	$17.21 billion	0.79	$976.81 million	$1.28	14.65
Masco	$7.60 billion	1.69	$822.00 million	$3.90	15.87

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

Insider and Institutional Ownership

93.9% of Masco shares are held by institutional investors. 0.5% of Masco shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

Masco beats Obayashi on 13 of the 15 factors compared between the two stocks.

About Obayashi

Obayashi Corporation engages in the construction business in Japan, North America, Asia, the Middle East, Europe, and Oceania. The company constructs buildings, including offices, condominiums, commercial facilities, factories, hospitals, and schools; and civil engineering projects, such as tunnels, bridges, dams, river works, urban civil engineering structures, railroads, and expressways. It is also involved in the development and leasing of real estate properties in various locations, primarily in urban areas, as well as property management activities; solar, biomass, geothermal, and wind power generation business; and PPP and agriculture business. In addition, the company provides non-life insurance agency business. Further, it engages in the provision of urban redevelopment, contracted operations, and facility management services, as well as M&E design and construction activities. The company was founded in 1892 and is headquartered in Tokyo, Japan.

About Masco

Masco Corporation designs, manufactures, and distributes home improvement and building products in North America, Europe, and internationally. The company's Plumbing Products segment offers faucets, showerheads, handheld showers, valves, bath hardware and accessories, bathing units, shower bases and enclosures, sinks, toilets, acrylic tubs, shower trays, spas, exercise pools, and fitness systems; brass, copper, and composite plumbing system components; connected water products; thermoplastic solutions, extruded plastic profiles, specialized fabrications, and PEX tubing products; and other non-decorative plumbing products. This segment provides its products under the DELTA, BRIZO, PEERLESS, HANSGROHE, AXOR, KRAUS, EASY DRAIN, STEAMIST, ELITESTEAM, GINGER, NEWPORT BRASS, BRASSTECH, WALTEC, BRISTAN, HERITAGE, MIROLIN, HOT SPRING, CALDERA, FREEFLOW SPAS, FANTASY SPAS, ENDLESS POOLS, BRASSCRAFT, PLUMB SHOP, COBRA, COBRA PRO, and MASTER PLUMBER brands. Its Decorative Architectural Products segment offers paints, primers, specialty coatings, stains, and waterproofing products, as well as paint applicators and accessories; cabinet and door hardware, functional hardware, wall plates, hook and rail products, closet organization systems, and picture hanging accessories; decorative bath hardware, mirrors, and shower accessories and doors; and decorative indoor and outdoor lighting fixtures, ceiling fans, landscape lighting, and LED lighting systems. This segment provides its products under the BEHR, KILZ, WHIZZ, Elder & Jenks, LIBERTY, BRAINERD, FRANKLIN BRASS, KICHLER, and ÉLAN brands. It sells its products to the plumbing, heating, and hardware wholesalers; home centers and online retailers; hardware stores; electrical and landscape distributors; lighting showrooms; building supply outlets; and other mass merchandisers. Masco Corporation was incorporated in 1929 and is headquartered in Livonia, Michigan.