Critical Contrast: Primoris Services (NYSE:PRIM) vs. Construction Partners (NASDAQ:ROAD)

Primoris Services (NYSE:PRIM) and Construction Partners (NASDAQ:ROAD) are both mid-cap industrials companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, risk, earnings and institutional ownership.

Volatility & Risk

Primoris Services has a beta of 1.44, indicating that its share price is 44% more volatile than the S&P 500. Comparatively, Construction Partners has a beta of 0.93, indicating that its share price is 7% less volatile than the S&P 500.

Institutional & Insider Ownership

91.8% of Primoris Services shares are owned by institutional investors. Comparatively, 94.8% of Construction Partners shares are owned by institutional investors. 1.1% of Primoris Services shares are owned by company insiders. Comparatively, 15.7% of Construction Partners shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Primoris Services and Construction Partners”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Primoris Services	$7.57 billion	0.59	$274.90 million	$2.55	32.51
Construction Partners	$2.81 billion	1.74	$101.78 million	$2.55	33.80

Primoris Services has higher revenue and earnings than Construction Partners. Primoris Services is trading at a lower price-to-earnings ratio than Construction Partners, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings for Primoris Services and Construction Partners, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Primoris Services	0	7	10	0	2.59
Construction Partners	0	4	3	1	2.62

Primoris Services presently has a consensus price target of $123.47, indicating a potential upside of 48.94%. Construction Partners has a consensus price target of $133.50, indicating a potential upside of 54.91%. Given Construction Partners’ stronger consensus rating and higher probable upside, analysts plainly believe Construction Partners is more favorable than Primoris Services.

Profitability

This table compares Primoris Services and Construction Partners’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Primoris Services	1.92%	9.96%	3.67%
Construction Partners	4.10%	16.06%	4.59%

Summary

Construction Partners beats Primoris Services on 10 of the 14 factors compared between the two stocks.

About Primoris Services

Primoris Services Corporation, a specialty contractor company, provides a range of construction, fabrication, maintenance, replacement, and engineering services in the United States and Canada. It operates through three segments: Utilities, Energy/Renewables, and Pipeline Services. The Utilities segment offers installation and maintenance services for new and existing natural gas distribution systems, electric utility distribution and transmission systems, and communications systems. The Energy/Renewables segment provides a range of services, including engineering, procurement, and construction, as well as retrofits, highway and bridge construction, demolition, site work, soil stabilization, mass excavation, flood control, upgrades, repairs, outages, and maintenance services to renewable energy and energy storage, renewable fuels, petroleum, refining, and petrochemical industries, as well as state departments of transportation. The Pipeline Services segment offers a range of services comprising pipeline construction, maintenance, facility, and integrity services; installation of compressor and pump stations; and metering facilities for entities in the petroleum and petrochemical industries, as well as gas, water, and sewer utilities. The company was founded in 1960 and is headquartered in Dallas, Texas.

About Construction Partners

Construction Partners, Inc., a civil infrastructure company, constructs and maintains roadways in Alabama, Florida, Georgia, North Carolina, South Carolina, and Tennessee. The company provides various products and services to public and private infrastructure projects, such as highways, roads, bridges, airports, and commercial and residential developments. It also engages in manufacturing and distributing hot mix asphalt (HMA) for internal use and sales to third parties in connection with construction projects; and paving activities, including the construction of roadway base layers and application of asphalt pavement. In addition, the company is involved in site development, including the installation of utility and drainage systems; mining aggregates, such as sand, gravel, and construction stones that are used as raw materials in the production of HMA; and distributing liquid asphalt cement for internal use and sales to third parties in connection with HMA production. The company was formerly known as SunTx CPI Growth Company, Inc. and changed its name to Construction Partners, Inc. in September 2017. Construction Partners, Inc. was founded in 2007 and is headquartered in Dothan, Alabama.