Vulcan Materials (NYSE: VMC) and Fairmount Santrol (NYSE:FMSA) are both construction companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, profitability, valuation, earnings, dividends and risk.
Valuation and Earnings
This table compares Vulcan Materials and Fairmount Santrol’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Vulcan Materials||$3.89 billion||4.48||$601.18 million||$3.04||43.38|
|Fairmount Santrol||$959.79 million||1.32||$53.78 million||$0.24||23.46|
Vulcan Materials has higher revenue and earnings than Fairmount Santrol. Fairmount Santrol is trading at a lower price-to-earnings ratio than Vulcan Materials, indicating that it is currently the more affordable of the two stocks.
Vulcan Materials pays an annual dividend of $1.12 per share and has a dividend yield of 0.8%. Fairmount Santrol does not pay a dividend. Vulcan Materials pays out 36.8% of its earnings in the form of a dividend. Vulcan Materials has raised its dividend for 4 consecutive years.
Risk and Volatility
Vulcan Materials has a beta of 1.01, suggesting that its share price is 1% more volatile than the S&P 500. Comparatively, Fairmount Santrol has a beta of 2.13, suggesting that its share price is 113% more volatile than the S&P 500.
This table compares Vulcan Materials and Fairmount Santrol’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Institutional and Insider Ownership
94.7% of Vulcan Materials shares are owned by institutional investors. Comparatively, 71.5% of Fairmount Santrol shares are owned by institutional investors. 0.8% of Vulcan Materials shares are owned by insiders. Comparatively, 9.8% of Fairmount Santrol shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
This is a summary of current ratings and target prices for Vulcan Materials and Fairmount Santrol, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Vulcan Materials currently has a consensus price target of $140.57, indicating a potential upside of 6.61%. Fairmount Santrol has a consensus price target of $6.01, indicating a potential upside of 6.68%. Given Fairmount Santrol’s higher possible upside, analysts plainly believe Fairmount Santrol is more favorable than Vulcan Materials.
Vulcan Materials beats Fairmount Santrol on 10 of the 17 factors compared between the two stocks.
About Vulcan Materials
Vulcan Materials Company produces and supplies construction aggregates, asphalt mix, and ready-mixed concrete primarily in the United States. It operates through four segments: Aggregates, Asphalt, Concrete, and Calcium. The Aggregates segment provides crushed stone, sand and gravel, sand, and other aggregates; and related products and services for use in the construction and maintenance of highways, streets, and other public works, as well as in the construction of housing and commercial, industrial, and other nonresidential facilities. The Asphalt Mix segment offers asphalt mix in Arizona, California, New Mexico, Tennessee, and Texas. The Concrete segment provides ready-mixed concrete in California, Georgia, Maryland, New Mexico, Texas, Virginia, Washington D.C., and the Bahamas. The Calcium segment mines, produces, and sells calcium products for the animal feed, plastics, and water treatment industries. The company was formerly known as Virginia Holdco, Inc. Vulcan Materials Company was founded in 1909 and is headquartered in Birmingham, Alabama.
About Fairmount Santrol
Fairmount Santrol Holdings Inc., together with its subsidiaries, provides sand-based proppant solutions for exploration and production companies. The company operates in two segments, Proppant Solutions and Industrial & Recreational Products. The Proppant Solutions segment primarily provides sand-based proppants for use in hydraulic fracturing operations in the United States, Canada, Argentina, Mexico, China, and northern Europe. Its products include northern white frac sand, API-spec brown sand, and coated sand products; and Propel SSP product that utilizes a polymer coating applied to a proppant substrate. The Industrial & Recreational Products segment offers raw, coated, and custom blended sands for use in building products, foundry, glass, turf and landscape, and filtration industries primarily in North America. Fairmount Santrol Holdings Inc. also supplies proppants to oilfield service companies. The company was formerly known as FMSA Holdings Inc. and changed its name to Fairmount Santrol Holdings Inc. in July 2015. Fairmount Santrol Holdings Inc. was incorporated in 1986 and is headquartered in Chesterland, Ohio.
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