Masonite International Corporation (NYSE: DOOR) and Tecnoglass (NASDAQ:TGLS) are both small-cap consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, profitability, valuation, dividends, analyst recommendations and risk.

Profitability

This table compares Masonite International Corporation and Tecnoglass’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Masonite International Corporation 4.95% 14.01% 6.36%
Tecnoglass -2.45% 16.94% 4.36%

Earnings and Valuation

This table compares Masonite International Corporation and Tecnoglass’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Masonite International Corporation $1.98 billion 0.90 $225.38 million $3.19 18.97
Tecnoglass $308.14 million 0.74 $57.67 million ($0.27) -25.15

Masonite International Corporation has higher revenue and earnings than Tecnoglass. Tecnoglass is trading at a lower price-to-earnings ratio than Masonite International Corporation, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

97.9% of Masonite International Corporation shares are owned by institutional investors. Comparatively, 5.2% of Tecnoglass shares are owned by institutional investors. 2.2% of Masonite International Corporation shares are owned by insiders. Comparatively, 67.2% of Tecnoglass shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Risk and Volatility

Masonite International Corporation has a beta of 1.26, indicating that its stock price is 26% more volatile than the S&P 500. Comparatively, Tecnoglass has a beta of 0.44, indicating that its stock price is 56% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current recommendations for Masonite International Corporation and Tecnoglass, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Masonite International Corporation 0 2 6 0 2.75
Tecnoglass 0 1 1 0 2.50

Masonite International Corporation presently has a consensus target price of $75.00, suggesting a potential upside of 23.97%. Tecnoglass has a consensus target price of $17.00, suggesting a potential upside of 150.37%. Given Tecnoglass’ higher probable upside, analysts clearly believe Tecnoglass is more favorable than Masonite International Corporation.

Dividends

Tecnoglass pays an annual dividend of $0.13 per share and has a dividend yield of 1.9%. Masonite International Corporation does not pay a dividend. Tecnoglass pays out -48.1% of its earnings in the form of a dividend.

Summary

Masonite International Corporation beats Tecnoglass on 11 of the 16 factors compared between the two stocks.

About Masonite International Corporation

Masonite International Corporation is designer and manufacturer of interior and exterior doors for the residential new construction; the residential repair, renovation and remodeling, and the non-residential building construction markets. The Company principally operates in North America; Europe, Asia and Latin America, and Africa. The Company markets and sells its products to remodeling contractors, builders, homeowners, retailers, dealers, lumberyards, commercial and general contractors and architects through wholesale and retail distribution channels. Its portfolio of brands includes Masonite, Marshfield, Premdor, Mohawk, Megantic, Algoma, Baillargeon, Birchwood Best and Lemieux. In February 2014, Masonite International Corporation completed the acquisition of Door-Stop International Limited.

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