Financial Analysis: JFB Construction (NASDAQ:JFB) and INNOVATE (NYSE:VATE)

INNOVATE (NYSE:VATE) and JFB Construction (NASDAQ:JFB) are both small-cap industrials companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, profitability, dividends, analyst recommendations, earnings, institutional ownership and risk.

Volatility and Risk

INNOVATE has a beta of 2.57, indicating that its share price is 157% more volatile than the S&P 500. Comparatively, JFB Construction has a beta of 3.36, indicating that its share price is 236% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for INNOVATE and JFB Construction, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
INNOVATE	1	0	0	0	1.00
JFB Construction	1	1	2	0	2.25

JFB Construction has a consensus target price of $9.50, suggesting a potential upside of 92.11%. Given JFB Construction’s stronger consensus rating and higher probable upside, analysts plainly believe JFB Construction is more favorable than INNOVATE.

Profitability

This table compares INNOVATE and JFB Construction’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
INNOVATE	-1.48%	N/A	-2.35%
JFB Construction	-25.19%	-28.42%	-25.03%

Earnings & Valuation

This table compares INNOVATE and JFB Construction”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
INNOVATE	$1.25 billion	0.06	-$60.60 million	($1.87)	-2.74
JFB Construction	$42.70 million	2.34	-$5.27 million	($0.54)	-9.16

JFB Construction has lower revenue, but higher earnings than INNOVATE. JFB Construction is trading at a lower price-to-earnings ratio than INNOVATE, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

34.3% of INNOVATE shares are owned by institutional investors. 57.7% of INNOVATE shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

About INNOVATE

INNOVATE Corp. (NYSE: VATE) is a diversified holding company focused primarily on infrastructure and life sciences businesses. Through its subsidiaries, the company operates businesses involved in structural steel fabrication, industrial construction, engineering and related infrastructure services, as well as the development and commercialization of medical technologies. Its infrastructure operations are centered on DBM Global, a provider of structural steel and related services for commercial, industrial, institutional and infrastructure projects.

About JFB Construction

JFB Construction is a Singapore-based construction company that provides building and renovation services for residential and commercial properties. Its activities include general construction, property improvements and related contracting services. The company serves customers in Singapore, although detailed information about its project portfolio, operating history and leadership is limited in publicly available sources.