Contrasting Vulcan Materials (VMC) and FORTERRA INC (FRTA)

Vulcan Materials (NYSE: VMC) and FORTERRA INC (NASDAQ:FRTA) are both construction companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, risk, analyst recommendations, earnings, valuation, profitabiliy and institutional ownership.

Dividends

Vulcan Materials pays an annual dividend of $1.00 per share and has a dividend yield of 0.8%. FORTERRA INC does not pay a dividend. Vulcan Materials pays out 32.4% of its earnings in the form of a dividend. FORTERRA INC has raised its dividend for 3 consecutive years.

Profitability

This table compares Vulcan Materials and FORTERRA INC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Vulcan Materials	11.28%	8.72%	4.48%
FORTERRA INC	N/A	N/A	N/A

Valuation and Earnings

This table compares Vulcan Materials and FORTERRA INC’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	EBITDA	Earnings Per Share	Price/Earnings Ratio
Vulcan Materials	$3.70 billion	4.35	$942.78 million	$3.09	39.43
FORTERRA INC	$1.52 billion	0.37	$179.63 million	N/A	N/A

Vulcan Materials has higher revenue and earnings than FORTERRA INC.

Institutional and Insider Ownership

86.0% of Vulcan Materials shares are held by institutional investors. Comparatively, 98.8% of FORTERRA INC shares are held by institutional investors. 0.9% of Vulcan Materials shares are held by company insiders. Comparatively, 0.3% of FORTERRA INC shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current ratings and price targets for Vulcan Materials and FORTERRA INC, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Vulcan Materials	0	3	5	0	2.63
FORTERRA INC	0	6	3	0	2.33

Vulcan Materials currently has a consensus target price of $138.60, indicating a potential upside of 13.76%. FORTERRA INC has a consensus target price of $16.81, indicating a potential upside of 93.92%. Given FORTERRA INC’s higher probable upside, analysts plainly believe FORTERRA INC is more favorable than Vulcan Materials.

Summary

Vulcan Materials beats FORTERRA INC on 10 of the 14 factors compared between the two stocks.

Vulcan Materials Company Profile

Vulcan Materials Company is a supplier of construction aggregates (primarily crushed stone, sand and gravel) and a producer of asphalt mix and ready-mixed concrete. The Company operates through four segments: Aggregates, Asphalt Mix, Concrete and Calcium. The Aggregates segment produces and sells aggregates (crushed stone, sand and gravel, sand, and other aggregates) and related products and services (transportation and other). The Company produces and sells asphalt mix in Arizona, California, New Mexico and Texas. The Company produces and sells ready-mixed concrete in Georgia, Maryland, New Mexico, Texas, Virginia, Washington District of Columbia and the Bahamas. The Calcium segment consists of a Florida facility that mines, produces and sells calcium products. As of December 31, 2016, it had 337 active aggregates facilities. The Company sells aggregates that are used as ballast for construction and maintenance of railroad tracks.

FORTERRA INC Company Profile

Forterra, Inc. is a manufacturer of pipe and precast products. The Company offers products for a range of water-related infrastructure applications, including water transmission, distribution and drainage. The Company operates approximately 95 facilities. Its products are available in the United States and Eastern Canada.