American Woodmark (NASDAQ:AMWD) and Fortune Brands Home & Security (NYSE:FBHS) are both consumer discretionary companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, risk, analyst recommendations, profitability, earnings, institutional ownership and valuation.
Analyst Recommendations
This is a summary of recent ratings and target prices for American Woodmark and Fortune Brands Home & Security, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
American Woodmark | 0 | 2 | 4 | 0 | 2.67 |
Fortune Brands Home & Security | 1 | 6 | 10 | 0 | 2.53 |
American Woodmark currently has a consensus price target of $91.20, indicating a potential downside of 5.65%. Fortune Brands Home & Security has a consensus price target of $83.2222, indicating a potential downside of 5.77%. Given American Woodmark's stronger consensus rating and higher possible upside, research analysts clearly believe American Woodmark is more favorable than Fortune Brands Home & Security.
Profitability
This table compares American Woodmark and Fortune Brands Home & Security's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
American Woodmark | 3.95% | 14.88% | 6.48% |
Fortune Brands Home & Security | 8.36% | 22.37% | 8.68% |
Volatility and Risk
American Woodmark has a beta of 2.28, suggesting that its share price is 128% more volatile than the S&P 500. Comparatively, Fortune Brands Home & Security has a beta of 1.66, suggesting that its share price is 66% more volatile than the S&P 500.
Earnings and Valuation
This table compares American Woodmark and Fortune Brands Home & Security's gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
American Woodmark | $1.65 billion | 1.00 | $74.86 million | $6.59 | 14.67 |
Fortune Brands Home & Security | $5.76 billion | 2.13 | $431.90 million | $3.60 | 24.53 |
Fortune Brands Home & Security has higher revenue and earnings than American Woodmark. American Woodmark is trading at a lower price-to-earnings ratio than Fortune Brands Home & Security, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
91.3% of American Woodmark shares are owned by institutional investors. Comparatively, 86.6% of Fortune Brands Home & Security shares are owned by institutional investors. 1.0% of American Woodmark shares are owned by company insiders. Comparatively, 1.5% of Fortune Brands Home & Security shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Summary
Fortune Brands Home & Security beats American Woodmark on 8 of the 14 factors compared between the two stocks.