Deltic Timber Corporation (NYSE: DEL) and Boise Cascade, L.L.C. (NYSE:BCC) are both small-cap construction companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, valuation, analyst recommendations, institutional ownership, earnings, profitabiliy and dividends.

Profitability

This table compares Deltic Timber Corporation and Boise Cascade, L.L.C.’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Deltic Timber Corporation 4.47% 4.02% 1.79%
Boise Cascade, L.L.C. 1.08% 8.01% 3.03%

Dividends

Deltic Timber Corporation pays an annual dividend of $0.40 per share and has a dividend yield of 0.5%. Boise Cascade, L.L.C. does not pay a dividend. Deltic Timber Corporation pays out 48.8% of its earnings in the form of a dividend.

Risk and Volatility

Deltic Timber Corporation has a beta of 0.89, meaning that its stock price is 11% less volatile than the S&P 500. Comparatively, Boise Cascade, L.L.C. has a beta of 2.06, meaning that its stock price is 106% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Deltic Timber Corporation and Boise Cascade, L.L.C., as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Deltic Timber Corporation 1 5 4 0 2.30
Boise Cascade, L.L.C. 0 2 1 0 2.33

Deltic Timber Corporation presently has a consensus price target of $46.10, indicating a potential downside of 37.75%. Boise Cascade, L.L.C. has a consensus price target of $30.67, indicating a potential upside of 7.98%. Given Boise Cascade, L.L.C.’s stronger consensus rating and higher probable upside, analysts clearly believe Boise Cascade, L.L.C. is more favorable than Deltic Timber Corporation.

Valuation & Earnings

This table compares Deltic Timber Corporation and Boise Cascade, L.L.C.’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Deltic Timber Corporation $221.95 million 4.07 $46.71 million $0.82 90.32
Boise Cascade, L.L.C. $4.00 billion 0.27 $164.35 million $1.12 25.36

Boise Cascade, L.L.C. has higher revenue and earnings than Deltic Timber Corporation. Boise Cascade, L.L.C. is trading at a lower price-to-earnings ratio than Deltic Timber Corporation, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

81.0% of Deltic Timber Corporation shares are owned by institutional investors. Comparatively, 95.6% of Boise Cascade, L.L.C. shares are owned by institutional investors. 12.1% of Deltic Timber Corporation shares are owned by insiders. Comparatively, 1.0% of Boise Cascade, L.L.C. shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Boise Cascade, L.L.C. beats Deltic Timber Corporation on 10 of the 16 factors compared between the two stocks.

Deltic Timber Corporation Company Profile

Deltic Timber Corporation is a vertically integrated natural resources company. The Company is engaged in the growing and harvesting of timber and the manufacturing and marketing of lumber and medium density fiberboard (MDF). It operates through four segments: Woodlands, which manages all aspects of the Company’s timberlands; Manufacturing, which consists of its approximately two sawmills that manufacture a range of softwood lumber products and the Del-Tin Fiber plant that produces MDF; Real Estate, which includes the Company’s four real estate developments and a related country club operation, and Corporate. It is also engaged in real estate development in central Arkansas. As of December 31, 2016, it developed and operated its own seed orchard. Its sawmills are located at Ola in central Arkansas and at Waldo in south Arkansas. It is engaged in developing the Chenal Valley, which is an upscale planned community, with approximately 4,300 acres of residential and commercial properties.

Boise Cascade, L.L.C. Company Profile

Boise Cascade Company is an integrated wood products manufacturer and building materials distributor with operations throughout the United States and one manufacturing facility in Canada. The Company is also a producer of engineered wood products (EWP) and plywood in North America. The Company operates through three segments: Wood Products, Building Materials Distribution, and Corporate and Other. The Company’s products are used primarily in new residential construction, residential repair-and-remodeling projects, light commercial construction and industrial applications. The Company manufactures laminated veneer lumber (LVL), I-joists, and laminated beams, which are referred to as EWP. The Company’s Building Materials Distribution segment sells a range of building materials, including OSB, plywood and lumber (collectively commodities). The Company’s subsidiaries include Boise Cascade Wood Products, L.L.C. and Boise Cascade Building Materials Distribution, L.L.C.

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