Critical Comparison: Chicago Bridge & Iron (CBI) & Argan (AGX)
Chicago Bridge & Iron (NYSE: CBI) and Argan (NYSE:AGX) are both small-cap industrials companies, but which is the better business? We will contrast the two businesses based on the strength of their profitability, risk, dividends, earnings, institutional ownership, analyst recommendations and valuation.
Valuation and Earnings
This table compares Chicago Bridge & Iron and Argan’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Chicago Bridge & Iron||$10.68 billion||0.18||-$313.16 million||($9.62)||-2.00|
|Argan||$675.05 million||1.06||$70.32 million||$5.41||8.48|
This table compares Chicago Bridge & Iron and Argan’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Chicago Bridge & Iron||-13.33%||-10.86%||-2.04%|
Chicago Bridge & Iron pays an annual dividend of $0.14 per share and has a dividend yield of 0.7%. Argan pays an annual dividend of $1.00 per share and has a dividend yield of 2.2%. Chicago Bridge & Iron pays out -1.5% of its earnings in the form of a dividend. Argan pays out 18.5% 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.
Insider and Institutional Ownership
70.3% of Chicago Bridge & Iron shares are owned by institutional investors. Comparatively, 84.9% of Argan shares are owned by institutional investors. 1.1% of Chicago Bridge & Iron shares are owned by company insiders. Comparatively, 7.6% of Argan shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.
Risk & Volatility
Chicago Bridge & Iron has a beta of 2.22, suggesting that its stock price is 122% more volatile than the S&P 500. Comparatively, Argan has a beta of 0.86, suggesting that its stock price is 14% less volatile than the S&P 500.
This is a summary of current recommendations and price targets for Chicago Bridge & Iron and Argan, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Chicago Bridge & Iron||1||11||2||0||2.07|
Chicago Bridge & Iron currently has a consensus target price of $19.62, suggesting a potential upside of 1.74%. Argan has a consensus target price of $56.00, suggesting a potential upside of 22.14%. Given Argan’s higher possible upside, analysts plainly believe Argan is more favorable than Chicago Bridge & Iron.
Argan beats Chicago Bridge & Iron on 11 of the 16 factors compared between the two stocks.
Chicago Bridge & Iron Company Profile
Chicago Bridge & Iron Company N.V. provides services to customers in energy infrastructure market. The Company provides services, such as conceptual design, technology, engineering, procurement, fabrication, modularization, construction, commissioning, maintenance, program management and environmental services. Its Engineering and Construction segment provides engineering, procurement, and construction (EPC) services. Its Fabrication Services segment provides fabrication and erection of steel plate structures; fabrication of piping systems and process modules, and manufacturing and distribution of pipe and fittings. The Technology segment provides process technology licenses and associated engineering services, and catalysts, for petrochemical and refining industries, and offers process planning and project development services.
Argan Company Profile
Argan, Inc. is a holding company. The Company conducts operations through its subsidiaries, Gemma Power Systems, LLC and affiliates (GPS), Atlantic Projects Company Limited (APC), Southern Maryland Cable, Inc. (SMC) and The Roberts Company (Roberts). Through GPS and APC, the Company’s power industry services segment provides engineering, procurement, construction, commissioning, operations management, maintenance, development, technical and consulting services to the power generation and renewable energy markets. Through SMC, the telecommunications infrastructure services segment of the Company provides project management, construction, installation and maintenance services to commercial, local government and federal government customers. Through Roberts, the Company’s industrial fabrication and field services segment produces, delivers and installs fabricated steel components specializing in pressure vessels and heat exchangers for industrial plants.
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