Critical Analysis: Fortune Brands Home & Security (FBHS) and Apogee Enterprises (APOG)
Fortune Brands Home & Security (NYSE: FBHS) and Apogee Enterprises (NASDAQ:APOG) are both industrial products companies, but which is the superior stock? We will compare the two companies based on the strength of their analyst recommendations, risk, valuation, dividends, profitability, earnings and institutional ownership.
Risk & Volatility
Fortune Brands Home & Security has a beta of 1.37, meaning that its stock price is 37% more 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.
Earnings and Valuation
This table compares Fortune Brands Home & Security and Apogee Enterprises’ revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Fortune Brands Home & Security||$5.13 billion||1.99||$822.40 million||$2.84||23.36|
|Apogee Enterprises||$1.20 billion||1.17||$159.52 million||$2.74||17.83|
Fortune Brands Home & Security has higher revenue and earnings than Apogee Enterprises. Apogee Enterprises is trading at a lower price-to-earnings ratio than Fortune Brands Home & Security, indicating that it is currently the more affordable of the two stocks.
Fortune Brands Home & Security pays an annual dividend of $0.72 per share and has a dividend yield of 1.1%. Apogee Enterprises pays an annual dividend of $0.56 per share and has a dividend yield of 1.1%. Fortune Brands Home & Security pays out 25.4% of its earnings in the form of a dividend. Apogee Enterprises pays out 20.4% 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. Apogee Enterprises has raised its dividend for 3 consecutive years. Apogee Enterprises is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Insider & Institutional Ownership
88.1% of Fortune Brands Home & Security shares are held by institutional investors. 1.6% of Fortune Brands Home & Security shares are held by company insiders. Comparatively, 3.7% of Apogee Enterprises shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
This table compares Fortune Brands Home & Security and Apogee Enterprises’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Fortune Brands Home & Security||8.61%||18.93%||8.88%|
This is a breakdown of current recommendations and price targets for Fortune Brands Home & Security and Apogee Enterprises, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Fortune Brands Home & Security||0||6||8||0||2.57|
Fortune Brands Home & Security currently has a consensus target price of $68.00, indicating a potential upside of 2.52%. Apogee Enterprises has a consensus target price of $63.33, indicating a potential upside of 29.62%. Given Apogee Enterprises’ stronger consensus rating and higher possible upside, analysts clearly believe Apogee Enterprises is more favorable than Fortune Brands Home & Security.
Fortune Brands Home & Security beats Apogee Enterprises on 9 of the 17 factors compared between the two stocks.
About Fortune Brands Home & Security
Fortune Brands Home & Security, Inc. is a holding company. The Company operates through four segments. The Cabinets segment includes custom, semi-custom and stock cabinetry for the kitchen, bath and other parts of the home under brand names, including Aristokraft, Mid-Continent, Diamond, Kitchen Classics, Kitchen Craft, Schrock, Omega, Homecrest, Thomasville, StarMark and Ultracraft. The Plumbing segment manufactures or assembles and sells faucets, bath furnishings, accessories and kitchen sinks and waste disposals under the Moen, Riobel, ROHL, Perrin & Rowe, and Waste King brands. The Doors segment includes residential fiberglass and steel entry door systems under the Therma-Tru brand name and urethane millwork product lines under the Fypon brand name. The Security segment includes locks, safety and security devices and electronic security products under the Master Lock brand name and fire resistant safes, security containers and commercial cabinets under the SentrySafe brand name.
About Apogee Enterprises
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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