Financial Contrast: Simpson Manufacturing (SSD) & Masco Corporation (MAS)
Simpson Manufacturing (NYSE: SSD) and Masco Corporation (NYSE:MAS) are both mid-cap construction companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, valuation, analyst recommendations, earnings, risk and institutional ownership.
Volatility and Risk
Simpson Manufacturing has a beta of 1.41, meaning that its share price is 41% more volatile than the S&P 500. Comparatively, Masco Corporation has a beta of 1.54, meaning that its share price is 54% more volatile than the S&P 500.
This is a breakdown of current ratings and target prices for Simpson Manufacturing and Masco Corporation, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Masco Corporation has a consensus target price of $40.75, suggesting a potential upside of 4.46%. Given Masco Corporation’s higher probable upside, analysts plainly believe Masco Corporation is more favorable than Simpson Manufacturing.
This table compares Simpson Manufacturing and Masco Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation & Earnings
This table compares Simpson Manufacturing and Masco Corporation’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Simpson Manufacturing||$914.03 million||2.54||$171.24 million||$2.05||23.92|
|Masco Corporation||$7.47 billion||1.65||$1.23 billion||$1.62||24.08|
Masco Corporation has higher revenue and earnings than Simpson Manufacturing. Simpson Manufacturing is trading at a lower price-to-earnings ratio than Masco Corporation, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
83.6% of Simpson Manufacturing shares are owned by institutional investors. Comparatively, 88.4% of Masco Corporation shares are owned by institutional investors. 0.4% of Simpson Manufacturing shares are owned by company insiders. Comparatively, 1.3% of Masco Corporation shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Simpson Manufacturing pays an annual dividend of $0.84 per share and has a dividend yield of 1.7%. Masco Corporation pays an annual dividend of $0.40 per share and has a dividend yield of 1.0%. Simpson Manufacturing pays out 41.0% of its earnings in the form of a dividend. Masco Corporation pays out 24.7% 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. Simpson Manufacturing has raised its dividend for 3 consecutive years and Masco Corporation has raised its dividend for 3 consecutive years.
Masco Corporation beats Simpson Manufacturing on 10 of the 15 factors compared between the two stocks.
Simpson Manufacturing Company Profile
Simpson Manufacturing Co., Inc., through its subsidiary, Simpson Strong-Tie Company Inc. (SST), designs, engineers and manufactures wood construction products, including connectors, truss plates, fastening systems, fasteners and pre-fabricated lateral systems used in light-frame construction. The Company’s segments are North America, Europe, Asia/Pacific, and Administrative & All Other. The North America segment includes operations primarily in the United States and Canada. The Europe segment includes operations primarily in France, the United Kingdom, Germany, Denmark, Switzerland, Portugal, Poland, the Netherlands and Belgium. The Asia/Pacific segment includes operations primarily in Australia, New Zealand, South Africa, China, Taiwan and Vietnam. The Company manufactures concrete construction products used for concrete, masonry, steel construction and for concrete repair, protection and strengthening, including adhesives, chemicals and mechanical anchors.
Masco Corporation Company Profile
Masco Corporation designs, manufactures, markets and distributes branded home improvement and building products. The Company operates through four business segments: Plumbing Products, Decorative Architectural Products, Cabinetry Products, and Windows and Other Specialty Products. The Company’s portfolio of brands includes BEHR paint; DELTA and HANSGROHE faucets, bath and shower fixtures; KRAFTMAID and MERILLAT cabinets; MILGARD windows and doors, and HOT SPRING spas. The Company’s plumbing products include faucets, showerheads, handheld showers, valves, bathing units, shower enclosures and toilets and are sold to home center retailers and to wholesalers and distributors. It also produces architectural coatings, including paints, primers, specialty paints, stains and waterproofing products. In North America, it manufactures and sells value-priced, stock and semi-custom assembled cabinetry for kitchen, bath, storage, home office and home entertainment applications.
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