Perma-Pipe International (PPIH) & Its Peers Critical Analysis

Perma-Pipe International (NASDAQ:PPIH) is one of 434 public companies in the “Machinery” industry, but how does it compare to its peers? We will compare Perma-Pipe International to similar businesses based on the strength of its profitability, analyst recommendations, valuation, risk, earnings, institutional ownership and dividends.

Institutional & Insider Ownership

28.4% of Perma-Pipe International shares are owned by institutional investors. Comparatively, 52.2% of shares of all “Machinery” companies are owned by institutional investors. 1.1% of Perma-Pipe International shares are owned by company insiders. Comparatively, 14.1% of shares of all “Machinery” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Perma-Pipe International and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Perma-Pipe International	6.47%	15.92%	6.57%
Perma-Pipe International Competitors	-1,946.96%	-10.16%	0.86%

Risk & Volatility

Perma-Pipe International has a beta of 0.59, indicating that its share price is 41% less volatile than the S&P 500. Comparatively, Perma-Pipe International’s peers have a beta of 4.47, indicating that their average share price is 347% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and price targets for Perma-Pipe International and its peers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Perma-Pipe International	0	1	0	0	2.00
Perma-Pipe International Competitors	4079	14474	17890	777	2.41

Perma-Pipe International presently has a consensus target price of $36.00, suggesting a potential upside of 33.33%. As a group, “Machinery” companies have a potential upside of 33.51%. Given Perma-Pipe International’s peers stronger consensus rating and higher possible upside, analysts plainly believe Perma-Pipe International has less favorable growth aspects than its peers.

Valuation and Earnings

This table compares Perma-Pipe International and its peers top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Perma-Pipe International	$210.93 million	$17.03 million	15.98
Perma-Pipe International Competitors	$4.49 billion	$348.34 million	-14.61

Perma-Pipe International’s peers have higher revenue and earnings than Perma-Pipe International. Perma-Pipe International is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Summary

Perma-Pipe International peers beat Perma-Pipe International on 9 of the 13 factors compared.

About Perma-Pipe International

Perma-Pipe International Holdings, Inc., together with its subsidiaries, engineers, designs, manufactures, and sells specialty piping and leak detection systems. It offers insulated and jacketed district heating and cooling piping systems for energy distribution from central energy plants to various locations; and primary and secondary containment piping systems for transporting chemicals, hazardous fluids, and petroleum products, as well as engages in the coating and insulation of oil and gas gathering and transmission pipelines. The company also offers liquid and powder based anti-corrosion coatings for external and internal surfaces of steel pipe, including shapes like bends, reducers, tees, and other spools/fittings that is used in pipelines for the transportation of oil and gas products and potable water. It has operations in the United States, Canada, the Middle East, North Africa, Europe, India, and internationally. The company was formerly known as MFRI, Inc. and changed its name to Perma-Pipe International Holdings, Inc. in March 2017. Perma-Pipe International Holdings, Inc. was incorporated in 1993 and is headquartered in Spring, Texas.