Contrasting Smart Sand (SND) and USG (USG)

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

Earnings and Valuation

This table compares USG and Smart Sand’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
USG $3.20 billion 1.55 $95.00 million $0.69 50.78
Smart Sand $59.23 million 6.11 $10.37 million $0.66 13.58

USG has higher revenue and earnings than Smart Sand. Smart Sand is trading at a lower price-to-earnings ratio than USG, 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 USG and Smart Sand, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
USG 2 9 3 0 2.07
Smart Sand 0 4 5 0 2.56

USG presently has a consensus price target of $36.85, indicating a potential upside of 5.15%. Smart Sand has a consensus price target of $13.28, indicating a potential upside of 48.19%. Given Smart Sand’s stronger consensus rating and higher possible upside, analysts clearly believe Smart Sand is more favorable than USG.

Insider & Institutional Ownership

85.7% of USG shares are held by institutional investors. Comparatively, 49.7% of Smart Sand shares are held by institutional investors. 0.7% of USG shares are held by insiders. Comparatively, 46.4% of Smart Sand 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 USG and Smart Sand’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
USG 2.96% 13.36% 6.77%
Smart Sand 18.67% 14.41% 11.85%

Summary

Smart Sand beats USG on 8 of the 13 factors compared between the two stocks.

About USG

USG Corporation, through its subsidiaries, is a manufacturer and distributor of building materials. The Company’s segments include Gypsum, Ceilings and USG Boral Building Products (UBBP). It produces a range of products for use in new residential, new nonresidential, and residential and nonresidential repair and remodel construction, as well as products used in certain industrial processes. Its products are distributed through building materials dealers, home improvement centers and other retailers, specialty wallboard distributors, and contractors. Gypsum segment manufactures and markets gypsum and related products in the United States, Canada, Mexico and Latin America. Ceilings segment manufactures and markets interior systems products in the United States, Canada, Mexico and Latin America. The UBBP segment manufactures, distributes and sells certain building products, mines raw gypsum and sells natural and synthetic gypsum throughout Asia, Australasia and the Middle East.

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.

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