Analyzing Masonite International Corporation (DOOR) and Patrick Industries (PATK)

Masonite International Corporation (NYSE: DOOR) and Patrick Industries (NASDAQ:PATK) are both doors & window frames companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, profitability, institutional ownership, risk, analyst recommendations, earnings and valuation.

Institutional and Insider Ownership

98.8% of Masonite International Corporation shares are held by institutional investors. Comparatively, 89.7% of Patrick Industries shares are held by institutional investors. 2.2% of Masonite International Corporation shares are held by insiders. Comparatively, 6.2% of Patrick Industries shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Masonite International Corporation and Patrick Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Masonite International Corporation 4.75% 14.38% 6.33%
Patrick Industries 4.73% 24.60% 11.00%

Analyst Recommendations

This is a breakdown of current ratings for Masonite International Corporation and Patrick Industries, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Masonite International Corporation 0 4 6 0 2.60
Patrick Industries 0 1 2 0 2.67

Masonite International Corporation presently has a consensus target price of $75.80, indicating a potential upside of 5.94%. Patrick Industries has a consensus target price of $80.67, indicating a potential downside of 10.67%. Given Masonite International Corporation’s higher possible upside, equities research analysts clearly believe Masonite International Corporation is more favorable than Patrick Industries.

Volatility & Risk

Masonite International Corporation has a beta of 1.37, indicating that its stock price is 37% more volatile than the S&P 500. Comparatively, Patrick Industries has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500.

Valuation and Earnings

This table compares Masonite International Corporation and Patrick Industries’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Masonite International Corporation $1.97 billion 1.03 $98.62 million $3.18 22.50
Patrick Industries $1.22 billion 1.24 $55.57 million $4.37 20.66

Masonite International Corporation has higher revenue and earnings than Patrick Industries. Patrick Industries is trading at a lower price-to-earnings ratio than Masonite International Corporation, indicating that it is currently the more affordable of the two stocks.

Summary

Masonite International Corporation beats Patrick Industries on 8 of the 14 factors compared between the two stocks.

Masonite International Corporation Company Profile

Masonite International Corporation is designer and manufacturer of interior and exterior doors for the residential new construction; the residential repair, renovation and remodeling, and the non-residential building construction markets. The Company principally operates in North America; Europe, Asia and Latin America, and Africa. The Company markets and sells its products to remodeling contractors, builders, homeowners, retailers, dealers, lumberyards, commercial and general contractors and architects through wholesale and retail distribution channels. Its portfolio of brands includes Masonite, Marshfield, Premdor, Mohawk, Megantic, Algoma, Baillargeon, Birchwood Best and Lemieux. In February 2014, Masonite International Corporation completed the acquisition of Door-Stop International Limited.

Patrick Industries Company Profile

Patrick Industries, Inc. is a manufacturer of component products and distributor of building products and materials for the recreational vehicle (RV) and manufactured housing (MH) industrial markets for customers throughout the United States and Canada. In addition, it is a supplier to certain other industrial markets, such as kitchen cabinet, office and household furniture, fixtures and commercial furnishings, marine, and other industrial markets. The Company’s segments include Manufacturing and Distribution. It manufactures a range of products, which include decorative vinyl and paper laminated panels, solid surface, granite and quartz countertops, fabricated aluminum products, wrapped vinyl, paper and hardwood profile mouldings, slide-out trim and fascia, cabinet doors and components, hardwood furniture, fiberglass and plastic component products including front and rear caps and marine helms, interior passage doors, RV painting, and slotwall panels and components, among others.

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