Masco Corporation (NYSE: MAS) and Apogee Enterprises (NASDAQ:APOG) are both construction companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, profitability, institutional ownership, earnings, valuation, dividends and analyst recommendations.

Risk & Volatility

Masco Corporation has a beta of 1.54, indicating that its stock price is 54% more volatile than the S&P 500. Comparatively, Apogee Enterprises has a beta of 1.56, indicating that its stock price is 56% more volatile than the S&P 500.

Dividends

Masco Corporation pays an annual dividend of $0.42 per share and has a dividend yield of 1.0%. Apogee Enterprises pays an annual dividend of $0.56 per share and has a dividend yield of 1.2%. Masco Corporation pays out 25.9% of its earnings in the form of a dividend. Apogee Enterprises pays out 20.4% 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. Apogee Enterprises has raised its dividend for 3 consecutive years. Apogee Enterprises is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Institutional & Insider Ownership

88.3% of Masco Corporation shares are held by institutional investors. 1.3% of Masco Corporation shares are held by insiders. Comparatively, 3.7% of Apogee Enterprises shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Masco Corporation and Apogee Enterprises’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Masco Corporation 7.09% 20,509.09% 10.67%
Apogee Enterprises 5.06% 14.20% 7.68%

Valuation & Earnings

This table compares Masco Corporation and Apogee Enterprises’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Masco Corporation $7.47 billion 1.71 $1.23 billion $1.62 24.76
Apogee Enterprises $1.20 billion 1.12 $159.52 million $2.74 17.19

Masco Corporation has higher revenue and earnings than Apogee Enterprises. Apogee Enterprises is trading at a lower price-to-earnings ratio than Masco Corporation, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and price targets for Masco Corporation and Apogee Enterprises, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Masco Corporation 0 3 11 0 2.79
Apogee Enterprises 0 0 3 0 3.00

Masco Corporation currently has a consensus price target of $40.75, suggesting a potential upside of 1.60%. Apogee Enterprises has a consensus price target of $63.33, suggesting a potential upside of 34.49%. Given Apogee Enterprises’ stronger consensus rating and higher probable upside, analysts clearly believe Apogee Enterprises is more favorable than Masco Corporation.

Summary

Masco Corporation beats Apogee Enterprises on 9 of the 17 factors compared between the two stocks.

Masco Corporation Company Profile

Masco Corporation designs, manufactures, markets and distributes branded home improvement and building products. The Company operates through four business segments: Plumbing Products, Decorative Architectural Products, Cabinetry Products, and Windows and Other Specialty Products. The Company’s portfolio of brands includes BEHR paint; DELTA and HANSGROHE faucets, bath and shower fixtures; KRAFTMAID and MERILLAT cabinets; MILGARD windows and doors, and HOT SPRING spas. The Company’s plumbing products include faucets, showerheads, handheld showers, valves, bathing units, shower enclosures and toilets and are sold to home center retailers and to wholesalers and distributors. It also produces architectural coatings, including paints, primers, specialty paints, stains and waterproofing products. In North America, it manufactures and sells value-priced, stock and semi-custom assembled cabinetry for kitchen, bath, storage, home office and home entertainment applications.

Apogee Enterprises Company Profile

Apogee Enterprises, Inc. is engaged in the design and development of glass solutions for enclosing commercial buildings and framing art. The Company operates through four segments: Architectural Glass, Architectural Services, Architectural Framing Systems and Large-Scale Optical Technologies (LSO). The Architectural Glass segment fabricates coated glass used in customized window and wall systems. The Architectural Services segment designs, engineers, fabricates and installs the walls of glass, windows and other curtainwall products making up the outside skin of commercial and institutional buildings. The Architectural Framing Systems segment designs, engineers, fabricates and finishes the aluminum frames used in customized aluminum and glass window, curtainwall, storefront and entrance systems. The Large-Scale Optical Technologies segment manufactures glass and acrylic products for the custom picture framing and fine art markets.

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