Smart Sand (NYSE: SND) and Summit Materials (NYSE:SUM) are both basic materials companies, but which is the better investment? We will compare the two companies based on the strength of their risk, valuation, dividends, analyst recommendations, earnings, profitability and institutional ownership.

Analyst Ratings

This is a summary of current recommendations for Smart Sand and Summit Materials, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Smart Sand 0 3 7 0 2.70
Summit Materials 0 2 6 0 2.75

Smart Sand presently has a consensus target price of $15.53, suggesting a potential upside of 214.97%. Summit Materials has a consensus target price of $30.33, suggesting a potential upside of 9.43%. Given Smart Sand’s higher possible upside, research analysts clearly believe Smart Sand is more favorable than Summit Materials.

Profitability

This table compares Smart Sand and Summit Materials’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Smart Sand 8.81% 6.22% 5.19%
Summit Materials 2.46% 9.90% 3.22%

Earnings & Valuation

This table compares Smart Sand and Summit Materials’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Smart Sand $73.93 million 2.69 $25.65 million N/A N/A
Summit Materials $1.76 billion 1.69 $368.45 million $0.56 49.26

Summit Materials has higher revenue and earnings than Smart Sand.

About Smart Sand

Smart Sand, Inc. is a producer of Northern White raw frac sand, which is a proppant used to enhance hydrocarbon recovery rates in the hydraulic fracturing of oil and natural gas wells. The Company sells its products primarily to oil and natural gas exploration and production companies and oilfield service companies under a combination of long-term take-or-pay contracts and spot sales in the open market. It owns and operates a raw frac sand mine and related processing facility near Oakdale, Wisconsin. In addition to the Oakdale facility, it owns a second property in Jackson County, Wisconsin, known as Hixton site. Its sand reserves include a balanced concentration of coarse (20/40, 30/50 and 40/70 gradation) sands and fine (60/140 gradation) sand. Its reserves contain deposits of approximately 20% of 20/40 and coarser substrate, over 40% of 40/70 mesh substrate and approximately 40% of 100-mesh substrate. Its 30/50 gradation is a derivative of the 20/40 and 40/70 blends.

About Summit Materials

Summit Materials, Inc. is a construction materials company. The Company operates through three segments: West, East and Cement. As of December 31, 2016, the Company had operations in 21 states in the United States and in British Columbia, Canada. The Company’s materials include aggregates, which it supplies across the United States, and in British Columbia, Canada, and cement, which it supplies along the Mississippi River from Minneapolis to New Orleans. Within its markets, it offers construction materials and related downstream products through its vertical integration. In addition to supplying of aggregates to its customers, the Company also uses its materials internally to produce ready-mix concrete and asphalt paving mix. Its construction materials operations consists of aggregates production, including crushed stone and construction sand and gravel, cement and ready-mixed concrete production, and asphalt paving mix production.

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