Stantec (STN) & Argan (AGX) Financial Survey
Argan (NYSE: AGX) and Stantec (NYSE:STN) are both construction companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, dividends, institutional ownership, profitability, earnings, analyst recommendations and risk.
Valuation & Earnings
This table compares Argan and Stantec’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Argan||$872.50 million||1.15||$131.21 million||$5.48||11.80|
|Stantec||$2.76 billion||1.16||$296.74 million||$0.78||35.96|
Stantec has higher revenue and earnings than Argan. Argan is trading at a lower price-to-earnings ratio than Stantec, indicating that it is currently the more affordable of the two stocks.
Argan pays an annual dividend of $0.70 per share and has a dividend yield of 1.1%. Stantec pays an annual dividend of $0.37 per share and has a dividend yield of 1.3%. Argan pays out 12.8% of its earnings in the form of a dividend. Stantec pays out 47.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Argan has raised its dividend for 4 consecutive years.
Insider and Institutional Ownership
86.5% of Argan shares are held by institutional investors. Comparatively, 57.0% of Stantec shares are held by institutional investors. 9.5% of Argan shares are held 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.
This table compares Argan and Stantec’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
This is a summary of recent recommendations for Argan and Stantec, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Argan presently has a consensus price target of $71.00, indicating a potential upside of 9.82%. Stantec has a consensus price target of $32.75, indicating a potential upside of 16.76%. Given Stantec’s stronger consensus rating and higher probable upside, analysts plainly believe Stantec is more favorable than Argan.
Volatility and Risk
Argan has a beta of 0.91, meaning that its share price is 9% less volatile than the S&P 500. Comparatively, Stantec has a beta of 1.58, meaning that its share price is 58% more volatile than the S&P 500.
Stantec beats Argan on 9 of the 17 factors compared between the two stocks.
Argan Company Profile
Argan, Inc. is a holding company. The Company conducts operations through its subsidiaries, Gemma Power Systems, LLC and affiliates (GPS), Atlantic Projects Company Limited (APC), Southern Maryland Cable, Inc. (SMC) and The Roberts Company (Roberts). Through GPS and APC, the Company’s power industry services segment provides engineering, procurement, construction, commissioning, operations management, maintenance, development, technical and consulting services to the power generation and renewable energy markets. Through SMC, the telecommunications infrastructure services segment of the Company provides project management, construction, installation and maintenance services to commercial, local government and federal government customers. Through Roberts, the Company’s industrial fabrication and field services segment produces, delivers and installs fabricated steel components specializing in pressure vessels and heat exchangers for industrial plants.
Stantec Company Profile
Stantec Inc. is a provider of professional services in the area of infrastructure and facilities for clients in the public and private sectors. The Company’s operates through four segments Consulting Services-Canada, Consulting Services-United States, Consulting Services-Global and Construction Services. The Company’s services include engineering, architecture, interior design, landscape architecture, surveying, environmental sciences, construction services, project management, and project economics, from initial project concept and planning through to design, construction, commissioning, maintenance, decommissioning and remediation. The Company provides professional consulting services in engineering, architecture, interior design, landscape architecture, surveying, environmental services, project management and project economics in the area of infrastructure and facilities, principally under fee-for-service agreements with clients.
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