Reviewing Innovate (NYSE:VATE) & Valmont Industries (NYSE:VMI)

Valmont Industries (NYSE:VMI) and Innovate (NYSE:VATE) are both industrial products companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, valuation, earnings, dividends, institutional ownership, risk and analyst recommendations.

Risk and Volatility

Valmont Industries has a beta of 1.14, suggesting that its share price is 14% more volatile than the S&P 500. Comparatively, Innovate has a beta of 2.01, suggesting that its share price is 101% more volatile than the S&P 500.

Valuation and Earnings

This table compares Valmont Industries and Innovate’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Valmont Industries $2.90 billion 1.76 $140.69 million $9.54 25.20
Innovate $1.01 billion 0.31 -$92.00 million ($3.02) -1.34

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

Profitability

This table compares Valmont Industries and Innovate’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Valmont Industries 6.13% 17.40% 6.98%
Innovate -21.42% -19.94% -1.38%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Valmont Industries and Innovate, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Valmont Industries 0 1 1 0 2.50
Innovate 0 0 0 0 N/A

Valmont Industries currently has a consensus target price of $292.50, suggesting a potential upside of 21.67%. Given Valmont Industries’ higher possible upside, research analysts clearly believe Valmont Industries is more favorable than Innovate.

Insider & Institutional Ownership

86.8% of Valmont Industries shares are owned by institutional investors. Comparatively, 37.1% of Innovate shares are owned by institutional investors. 2.4% of Valmont Industries shares are owned by insiders. Comparatively, 43.5% of Innovate shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

Valmont Industries beats Innovate on 11 of the 13 factors compared between the two stocks.

Valmont Industries Company Profile

Valmont Industries, Inc. engages in the designing and manufacturing of engineered fabricated metal products and service. It operates through the following four segments: Engineered Support Structures, Utility Support Structures, Irrigation, and Coatings. The Engineered Support Structures segment produces engineered access systems, highway safety products, and integrated structure solutions for smart cities. The Utility Support Structures segment manufactures steel and concrete pole structures for global utility transmission, distribution and generation platforms primarily in the U.S., and also produces steel energy generation structures and engineered solar tracking solutions sold outside the U.S. The Irrigation segment mechanized irrigation systems and provides water management solutions for large-scale production agriculture, and technology for precision agriculture. The Coatings segment provides global galvanizing, painting and anodizing services to preserve and protect metal products. The company was founded by Robert B. Daugherty in 1946 and is headquartered in Omaha, NE.

Innovate Company Profile

INNOVATE Corp. engages in the acquisition and investment of assets. It operates through the following segments: Infrastructure, Clean Energy, Telecommunications, Insurance, Life Sciences, Spectrum, and Other. The Infrastructure segment models, details, fabricates, and erects structural steel for commercial and industrial construction projects. The Clean Energy segment designs, builds, and maintains compressed natural gas fueling stations for transportation vehicles. The Telecommunications segment manages telecommunications business including a network of direct routes and provides voice communication services. The Insurance segment offers long-termcare, life, annuity, and other accident and health coverage. The Life Sciences segment maintains controlling interests in Genovel Orthopedics, Inc. and R2 Technologies, Inc. through Pansend Life Sciences LLC. The Spectrum segment owns over-the-air broadcasting stations and spanish-language broadcast network. The Other segment represents all other businesses or investments that do not meet the definition of a segment individually or in the aggregate. The company was founded in 1994 and is headquartered in New York, NY.

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