Contrasting Aspen Aerogels (NYSE:ASPN) and Advanced Drainage Systems (NYSE:WMS)

Advanced Drainage Systems (NYSE:WMS) and Aspen Aerogels (NYSE:ASPN) are both construction companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, institutional ownership, earnings, profitability, valuation and risk.

Valuation and Earnings

This table compares Advanced Drainage Systems and Aspen Aerogels”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Advanced Drainage Systems	$2.90 billion	3.60	$450.17 million	$6.01	22.33
Aspen Aerogels	$271.10 million	1.04	-$389.55 million	($4.74)	-0.72

Advanced Drainage Systems has higher revenue and earnings than Aspen Aerogels. Aspen Aerogels is trading at a lower price-to-earnings ratio than Advanced Drainage Systems, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and price targets for Advanced Drainage Systems and Aspen Aerogels, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Advanced Drainage Systems	0	1	8	0	2.89
Aspen Aerogels	2	2	3	0	2.14

Advanced Drainage Systems presently has a consensus target price of $186.00, indicating a potential upside of 38.59%. Aspen Aerogels has a consensus target price of $4.25, indicating a potential upside of 24.45%. Given Advanced Drainage Systems’ stronger consensus rating and higher probable upside, equities analysts clearly believe Advanced Drainage Systems is more favorable than Aspen Aerogels.

Risk and Volatility

Advanced Drainage Systems has a beta of 1.27, suggesting that its share price is 27% more volatile than the S&P 500. Comparatively, Aspen Aerogels has a beta of 2.99, suggesting that its share price is 199% more volatile than the S&P 500.

Profitability

This table compares Advanced Drainage Systems and Aspen Aerogels’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Advanced Drainage Systems	15.75%	27.72%	12.31%
Aspen Aerogels	-143.69%	-13.91%	-8.19%

Insider and Institutional Ownership

89.8% of Advanced Drainage Systems shares are owned by institutional investors. Comparatively, 97.6% of Aspen Aerogels shares are owned by institutional investors. 1.6% of Advanced Drainage Systems shares are owned by company insiders. Comparatively, 4.3% of Aspen Aerogels shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Advanced Drainage Systems beats Aspen Aerogels on 11 of the 14 factors compared between the two stocks.

About Advanced Drainage Systems

Advanced Drainage Systems, Inc. designs, manufactures, and markets thermoplastic corrugated pipes and related water management products in North America and internationally. The company operates through Pipe, International, Infiltrator, and Allied Products & Other segments. It offers single, double, and triple wall corrugated polypropylene and polyethylene pipes; plastic leachfield chambers and systems; EZflow synthetic aggregate bundles; wastewater purification through mechanical aeration wastewater for residential and commercial systems; septic tanks and accessories; combined treatment and dispersal systems, including advanced enviro-septic and advanced treatment leachfield systems; and allied products, including storm retention/detention and septic chambers, polyvinyl chloride drainage structures, fittings, and water quality filters and separators. The company also purchases and distributes construction fabrics and other geosynthetic products for soil stabilization, reinforcement, filtration, separation, erosion control, and sub-surface drainage, as well as drainage grates and other products. In addition, it provides PVC hubs, rubber sleeves, and stainless-steel bands. The company offers its products for non-residential, residential, agriculture, and infrastructure applications through a network of distribution centers. Advanced Drainage Systems, Inc. incorporated in 1966 and is headquartered in Hilliard, Ohio.

About Aspen Aerogels

Aspen Aerogels, Inc. designs, develops, manufactures, and sells aerogel insulation products primarily for use in the energy infrastructure and sustainable insulation materials markets in the United States, Asia, Canada, Europe, and Latin America. It operates in two segments, Energy Industrial and Thermal Barrier. The company offers PyroThin thermal barriers for use in lithium-ion batteries in electric vehicles and energy storage industries; Pyrogel XTE that reduces the risk of corrosion under insulation in energy infrastructure operating systems; and Pyrogel HPS for applications within the power generation market. It also offers Pyrogel XTF to provide protection against fire; Cryogel Z for sub-ambient and cryogenic applications in the energy infrastructure market; Spaceloft Subsea for use in pipe-in-pipe applications in offshore oil production; and Cryogel X201, which is used in designing cold systems, such as refrigerated appliances, cold storage equipment, and aerospace systems. The company was founded in 2001 and is headquartered in Northborough, Massachusetts.