Universal Forest Products (UFPI) and BMC Stock Holdings (BMCH) Critical Comparison
Universal Forest Products (NASDAQ: UFPI) and BMC Stock Holdings (NASDAQ:BMCH) are both construction companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, earnings, dividends, risk, valuation, analyst recommendations and institutional ownership.
Insider and Institutional Ownership
77.3% of Universal Forest Products shares are held by institutional investors. 3.4% of Universal Forest Products shares are held by insiders. Comparatively, 3.7% of BMC Stock Holdings shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
This is a summary of recent ratings and recommmendations for Universal Forest Products and BMC Stock Holdings, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Universal Forest Products||0||1||1||0||2.50|
|BMC Stock Holdings||0||0||6||0||3.00|
Universal Forest Products presently has a consensus target price of $36.67, suggesting a potential downside of 66.67%. BMC Stock Holdings has a consensus target price of $24.00, suggesting a potential upside of 5.96%. Given BMC Stock Holdings’ stronger consensus rating and higher probable upside, analysts clearly believe BMC Stock Holdings is more favorable than Universal Forest Products.
This table compares Universal Forest Products and BMC Stock Holdings’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Universal Forest Products||2.85%||12.05%||7.61%|
|BMC Stock Holdings||1.53%||9.42%||4.48%|
Volatility and Risk
Universal Forest Products has a beta of 1.84, meaning that its share price is 84% more volatile than the S&P 500. Comparatively, BMC Stock Holdings has a beta of 1.49, meaning that its share price is 49% more volatile than the S&P 500.
Universal Forest Products pays an annual dividend of $0.90 per share and has a dividend yield of 0.8%. BMC Stock Holdings does not pay a dividend. Universal Forest Products pays out 16.9% of its earnings in the form of a dividend.
Earnings and Valuation
This table compares Universal Forest Products and BMC Stock Holdings’ gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Universal Forest Products||$3.24 billion||0.69||$101.17 million||$5.33||20.64|
|BMC Stock Holdings||$3.09 billion||0.49||$30.88 million||$0.75||30.20|
Universal Forest Products has higher revenue and earnings than BMC Stock Holdings. Universal Forest Products is trading at a lower price-to-earnings ratio than BMC Stock Holdings, indicating that it is currently the more affordable of the two stocks.
Universal Forest Products beats BMC Stock Holdings on 10 of the 16 factors compared between the two stocks.
About Universal Forest Products
Universal Forest Products, Inc. is a holding company. The Company, through its subsidiaries, supplies wood, wood composite and other products to three primary markets, such as retail, construction and industrial. Its segments include North, South, West, Alternative Materials, International, idX Holdings, Inc. (idX) and Corporate divisions. idX is a designer, manufacturer and installer of in-store environments. It designs, manufactures and markets wood and wood-alternative products for national home centers and other retailers; structural lumber and other products for the manufactured housing industry; engineered wood components for residential and commercial construction; specialty wood packaging, components and packing materials for various industries, and customized interior fixtures used in a range of retail stores, commercial and other structures. Its customers comprising retail market are national home center retailers and retail-oriented regional lumberyards, among others.
About BMC Stock Holdings
BMC Stock Holdings, Inc. is a provider of building products and services in the United States residential construction market. The Company’s segments include Mid-Atlantic, Southeast, Texas, Intermountain, Western and Mountain West divisions. Its product offerings include lumber and lumber sheet goods and an array of products, including millwork, doors, windows, structural components, floor and roof trusses and wall panels. Its whole-house framing solution is Ready-Frame. It also offers its customers services, such as design, product specification, installation and installation management. It manufactures floor trusses, roof trusses, wall panels, stairs, specialty millwork, windows and pre-hung doors. It also provides a range of installation services and special order products. The Company groups its building products and services into four product categories: structural components; lumber & lumber sheet goods; millwork, doors & windows, and other building products & services.
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