CRH (NYSE:CRH) & Quanex Building Products (NYSE:NX) Critical Survey

CRH (NYSE:CRH) and Quanex Building Products (NYSE:NX) are both construction companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, analyst recommendations, dividends, profitability, valuation, institutional ownership and earnings.

Institutional & Insider Ownership

62.5% of CRH shares are held by institutional investors. Comparatively, 97.5% of Quanex Building Products shares are held by institutional investors. 0.1% of CRH shares are held by insiders. Comparatively, 2.2% of Quanex Building Products shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Volatility and Risk

CRH has a beta of 1.32, indicating that its stock price is 32% more volatile than the S&P 500. Comparatively, Quanex Building Products has a beta of 0.98, indicating that its stock price is 2% less volatile than the S&P 500.

Dividends

CRH pays an annual dividend of $1.11 per share and has a dividend yield of 1.0%. Quanex Building Products pays an annual dividend of $0.32 per share and has a dividend yield of 2.4%. CRH pays out 23.2% of its earnings in the form of a dividend. Quanex Building Products pays out -5.1% 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. Quanex Building Products is clearly the better dividend stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of current ratings and target prices for CRH and Quanex Building Products, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
CRH	0	2	11	4	3.12
Quanex Building Products	2	0	0	0	1.00

CRH currently has a consensus target price of $127.21, suggesting a potential upside of 9.47%. Given CRH’s stronger consensus rating and higher probable upside, analysts clearly believe CRH is more favorable than Quanex Building Products.

Profitability

This table compares CRH and Quanex Building Products’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
CRH	9.09%	15.68%	6.83%
Quanex Building Products	-15.45%	10.48%	4.40%

Valuation and Earnings

This table compares CRH and Quanex Building Products”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
CRH	$35.57 billion	2.20	$3.46 billion	$4.78	24.31
Quanex Building Products	$1.28 billion	0.49	$33.06 million	($6.22)	-2.18

CRH has higher revenue and earnings than Quanex Building Products. Quanex Building Products is trading at a lower price-to-earnings ratio than CRH, indicating that it is currently the more affordable of the two stocks.

Summary

CRH beats Quanex Building Products on 13 of the 17 factors compared between the two stocks.

About CRH

CRH plc, together with its subsidiaries, provides building materials solutions in Ireland and internationally. It operates through four segments: Americas Materials Solutions, Americas Building Solutions, Europe Materials Solutions, and Europe Building Solutions. The company provides solutions for the construction and maintenance of public infrastructure and commercial and residential buildings; and produces and sells aggregates, cement, readymixed concrete, and asphalt, as well as provides paving and construction services. It also manufactures, supplies, and delivers solutions for the built environment in communities across North America; and offers building and infrastructure solutions serving complex critical utility infrastructure, such as water, energy, transportation, and telecommunications projects, and outdoor living solutions for enhancing private and public spaces. In addition, the company combines materials, products, and services to produce a wide range of architectural and infrastructural solutions for use in the building and renovation of critical utility infrastructure, commercial and residential buildings, and outdoor living spaces for the built environment. Further, it produces and supplies precast and pre-stressed concrete products comprising floor and wall elements, beams, vaults, pipes, and manholes; granite, limestone, and sandstone; concrete and polymer-based products, such as underground vaults, drainage systems, utility enclosures, and modular precast structures; engineered steel, polymer-based anchoring, fixing, and connecting solutions; concrete masonry, hardscape and related products, including pavers, blocks and curbs, retaining walls, and slabs; and fencing and railing systems, composite decking, lawn and garden products, and packaged concrete mixes. The company was founded in 1936 and is headquartered in Dublin, Ireland.

About Quanex Building Products

Quanex Building Products Corporation, together with its subsidiaries, provides components for the fenestration industry in the United States, rest of Europe, Canada, Asia, the United Kingdom, and internationally. The company operates through three segments: North American Fenestration, European Fenestration, and North American Cabinet Components. It offers flexible insulating glass spacers, extruded vinyl profiles, window and door screens, and precision-formed metal and wood products, as well as cabinet doors and other components for original equipment manufacturers (OEMs) in the kitchen and bathroom cabinet industry. In addition, the company provides various non-fenestration components and products, including solar panel sealants, trim moldings, vinyl decking, fencing, water retention barriers, and conservatory roof components. It sells its products to OEMs in the building products industry through sales representatives, direct sales force, distributors, and independent sales agents. Quanex Building Products Corporation was founded in 1927 and is based in Houston, Texas.