Quanex Building Products Corporation (NYSE: NX) and Apogee Enterprises (NASDAQ:APOG) are both small-cap construction companies, but which is the better stock? We will compare the two businesses based on the strength of their dividends, institutional ownership, risk, valuation, earnings, profitability and analyst recommendations.

Dividends

Quanex Building Products Corporation pays an annual dividend of $0.16 per share and has a dividend yield of 0.8%. Apogee Enterprises pays an annual dividend of $0.56 per share and has a dividend yield of 1.3%. Quanex Building Products Corporation pays out -533.2% of its earnings in the form of a dividend. Apogee Enterprises pays out 19.2% 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.

Valuation & Earnings

This table compares Quanex Building Products Corporation and Apogee Enterprises’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Quanex Building Products Corporation $901.48 million 0.72 $98.42 million ($0.03) -631.46
Apogee Enterprises $1.14 billion 1.08 $159.39 million $2.91 14.64

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

Insider and Institutional Ownership

99.5% of Quanex Building Products Corporation shares are held by institutional investors. 5.3% of Quanex Building Products Corporation shares are held by insiders. Comparatively, 3.7% of Apogee Enterprises shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

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

Net Margins Return on Equity Return on Assets
Quanex Building Products Corporation -0.09% 7.70% 3.64%
Apogee Enterprises 7.39% 18.59% 11.53%

Analyst Recommendations

This is a summary of recent ratings and target prices for Quanex Building Products Corporation and Apogee Enterprises, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Quanex Building Products Corporation 0 0 3 0 3.00
Apogee Enterprises 0 0 3 0 3.00

Quanex Building Products Corporation presently has a consensus target price of $23.75, suggesting a potential upside of 25.33%. Apogee Enterprises has a consensus target price of $63.33, suggesting a potential upside of 48.63%. Given Apogee Enterprises’ higher possible upside, analysts clearly believe Apogee Enterprises is more favorable than Quanex Building Products Corporation.

Volatility & Risk

Quanex Building Products Corporation has a beta of 0.65, meaning that its stock price is 35% less volatile than the S&P 500. Comparatively, Apogee Enterprises has a beta of 1.56, meaning that its stock price is 56% more volatile than the S&P 500.

Summary

Apogee Enterprises beats Quanex Building Products Corporation on 10 of the 14 factors compared between the two stocks.

Quanex Building Products Corporation Company Profile

Quanex Building Products Corporation manufactures components for original equipment manufacturers (OEM) in the building products industry. The Company’s components can be categorized as window and door (fenestration) components, and kitchen and bath cabinet components. The Company operates through three segments: North American Engineered Components (NA Engineered Components), which consists of four operating segments primarily focused on the fenestration market in North America manufacturing vinyl profiles, insulating glass (IG) spacers, screens and other fenestration components; European Engineered Components (EU Engineered Components), which consists of the United Kingdom-based vinyl extrusion business, manufacturing vinyl profiles and conservatories, and the European insulating glass business manufacturing IG spacers, and North American Cabinet Components (NA Cabinet Components), which consists of the North American cabinet door and components business.

Apogee Enterprises Company Profile

Apogee Enterprises, Inc. is engaged in the design and development of glass solutions for enclosing commercial buildings and framing art. The Company operates through four segments: Architectural Glass, Architectural Services, Architectural Framing Systems and Large-Scale Optical Technologies (LSO). The Architectural Glass segment fabricates coated glass used in customized window and wall systems. The Architectural Services segment designs, engineers, fabricates and installs the walls of glass, windows and other curtainwall products making up the outside skin of commercial and institutional buildings. The Architectural Framing Systems segment designs, engineers, fabricates and finishes the aluminum frames used in customized aluminum and glass window, curtainwall, storefront and entrance systems. The Large-Scale Optical Technologies segment manufactures glass and acrylic products for the custom picture framing and fine art markets.

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