Owens Corning (NYSE:OC) and Fortune Brands Innovations (NYSE:FBIN) Critical Review

Fortune Brands Innovations (NYSE:FBIN) and Owens Corning (NYSE:OC) are both industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, risk, valuation, profitability, earnings, analyst recommendations and institutional ownership.

Insider and Institutional Ownership

87.6% of Fortune Brands Innovations shares are owned by institutional investors. Comparatively, 88.4% of Owens Corning shares are owned by institutional investors. 3.3% of Fortune Brands Innovations shares are owned by company insiders. Comparatively, 0.9% of Owens Corning shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Fortune Brands Innovations and Owens Corning”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fortune Brands Innovations	$4.46 billion	1.22	$298.80 million	$1.23	36.99
Owens Corning	$10.10 billion	1.13	-$522.00 million	($8.06)	-17.89

Fortune Brands Innovations has higher earnings, but lower revenue than Owens Corning. Owens Corning is trading at a lower price-to-earnings ratio than Fortune Brands Innovations, indicating that it is currently the more affordable of the two stocks.

Dividends

Fortune Brands Innovations pays an annual dividend of $1.04 per share and has a dividend yield of 2.3%. Owens Corning pays an annual dividend of $3.16 per share and has a dividend yield of 2.2%. Fortune Brands Innovations pays out 84.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Owens Corning pays out -39.2% of its earnings in the form of a dividend. Fortune Brands Innovations has raised its dividend for 2 consecutive years and Owens Corning has raised its dividend for 10 consecutive years.

Risk & Volatility

Fortune Brands Innovations has a beta of 1.31, indicating that its share price is 31% more volatile than the S&P 500. Comparatively, Owens Corning has a beta of 1.32, indicating that its share price is 32% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Fortune Brands Innovations and Owens Corning, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fortune Brands Innovations	1	9	6	1	2.41
Owens Corning	1	6	9	2	2.67

Fortune Brands Innovations presently has a consensus price target of $55.71, suggesting a potential upside of 22.45%. Owens Corning has a consensus price target of $165.31, suggesting a potential upside of 14.63%. Given Fortune Brands Innovations’ higher possible upside, analysts plainly believe Fortune Brands Innovations is more favorable than Owens Corning.

Profitability

This table compares Fortune Brands Innovations and Owens Corning’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fortune Brands Innovations	3.39%	19.50%	7.09%
Owens Corning	-6.81%	20.52%	6.21%

About Fortune Brands Innovations

Fortune Brands Innovations, Inc. provides home and security products for residential home repair, remodeling, new construction, and security applications in the United States and internationally. The company operates through three segments: Water, Outdoors, and Security. The Water segment manufactures or assembles, and sells faucets, accessories, kitchen sinks, and waste disposals under the Moen, ROHL, Riobel, Victoria+Albert, Perrin & Rowe, Aqualisa, Shaws, Emtek, and Schaub brands. The Outdoors segment manufactures and sells fiberglass and steel entry door systems under the Therma-Tru brand; storm, screen, and security doors under the Larson brand; composite decking, railing, and cladding under the Fiberon brand; and urethane millwork under the Fypon brand. The Security segment manufactures, sources, and distributes locks, safety and security devices, and electronic security products under the Master Lock, American Lock, Yale, and August brands; and fire-resistant safes, security containers, and commercial cabinets under the SentrySafe brand. The company sells its products through various sales channels, including kitchen and bath dealers, wholesalers oriented toward builders or professional remodelers, industrial and locksmith distributors, do-it-yourself remodeling-oriented home centers, showrooms, e-commerce, and other retail outlets. Fortune Brands Innovations, Inc. was incorporated in 1988 and is headquartered in Deerfield, Illinois.

About Owens Corning

Owens Corning manufactures and sells building and construction materials in the United States, Europe, the Asia Pacific, and internationally. It operates in three segments: Roofing, Insulation, and Composites. The Roofing segment manufactures and sells laminate and strip asphalt roofing shingles, oxidized asphalt materials, and roofing components used in residential and commercial construction, and specialty applications. This segment sells its products through distributors, home centers, and lumberyards, as well as to roofing contractors for built-up roofing asphalt systems; and manufacturers in automotive, chemical, rubber, and construction industries. The Insulation segment manufactures and sells thermal and acoustical batts, loosefill insulation, spray foam insulation, foam sheathing and accessories under the Owens Corning PINK, and FIBERGLAS brands; and glass fiber pipe insulation, energy efficient flexible duct media, bonded and granulated mineral wool insulation, cellular glass insulation, and foam insulation under the FOAMULAR, FOAMGLAS, and Paroc brand names used in construction applications. This segment sells its products primarily to the insulation installers, home centers, lumberyards, retailers, and distributors. The Composites segment manufactures, fabricates, and sells glass reinforcements in the form of fiber; and glass fiber products in the form of fabrics, non-wovens, and composite lumber. Its products are used in building structures, roofing shingles, tubs and showers, pools, decking, flooring, pipes and tanks, poles, electrical equipment, and wind-energy turbine blades. This segment sells its products directly to parts molders, fabricators, and shingle manufacturers. The company was incorporated in 1938 and is headquartered in Toledo, Ohio.