Patrick Industries (NASDAQ: PATK) and Masonite International (NYSE:DOOR) are both construction companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, dividends, earnings, profitability, valuation, institutional ownership and risk.

Analyst Recommendations

This is a summary of current ratings for Patrick Industries and Masonite International, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Patrick Industries 0 1 2 0 2.67
Masonite International 0 4 6 0 2.60

Patrick Industries presently has a consensus target price of $80.67, suggesting a potential downside of 17.09%. Masonite International has a consensus target price of $75.80, suggesting a potential upside of 6.76%. Given Masonite International’s higher possible upside, analysts plainly believe Masonite International is more favorable than Patrick Industries.

Profitability

This table compares Patrick Industries and Masonite International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Patrick Industries 4.73% 24.60% 11.00%
Masonite International 4.75% 14.38% 6.33%

Risk and Volatility

Patrick Industries has a beta of 0.99, meaning that its share price is 1% less volatile than the S&P 500. Comparatively, Masonite International has a beta of 1.33, meaning that its share price is 33% more volatile than the S&P 500.

Earnings and Valuation

This table compares Patrick Industries and Masonite International’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Patrick Industries $1.22 billion 1.34 $55.57 million $4.37 22.27
Masonite International $1.97 billion 1.02 $98.62 million $3.16 22.47

Masonite International has higher revenue and earnings than Patrick Industries. Patrick Industries is trading at a lower price-to-earnings ratio than Masonite International, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

89.3% of Patrick Industries shares are owned by institutional investors. 5.2% of Patrick Industries shares are owned by insiders. Comparatively, 2.2% of Masonite International shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Patrick Industries beats Masonite International on 8 of the 14 factors compared between the two stocks.

About Patrick Industries

Patrick Industries, Inc. is a manufacturer of component products and distributor of building products and materials for the recreational vehicle (RV) and manufactured housing (MH) industrial markets for customers throughout the United States and Canada. In addition, it is a supplier to certain other industrial markets, such as kitchen cabinet, office and household furniture, fixtures and commercial furnishings, marine, and other industrial markets. The Company’s segments include Manufacturing and Distribution. It manufactures a range of products, which include decorative vinyl and paper laminated panels, solid surface, granite and quartz countertops, fabricated aluminum products, wrapped vinyl, paper and hardwood profile mouldings, slide-out trim and fascia, cabinet doors and components, hardwood furniture, fiberglass and plastic component products including front and rear caps and marine helms, interior passage doors, RV painting, and slotwall panels and components, among others.

About Masonite International

Masonite International Corporation is designer and manufacturer of interior and exterior doors for the residential new construction; the residential repair, renovation and remodeling, and the non-residential building construction markets. The Company principally operates in North America; Europe, Asia and Latin America, and Africa. The Company markets and sells its products to remodeling contractors, builders, homeowners, retailers, dealers, lumberyards, commercial and general contractors and architects through wholesale and retail distribution channels. Its portfolio of brands includes Masonite, Marshfield, Premdor, Mohawk, Megantic, Algoma, Baillargeon, Birchwood Best and Lemieux. In February 2014, Masonite International Corporation completed the acquisition of Door-Stop International Limited.

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