KBR (NYSE:KBR) and Quanta Services (NYSE:PWR) are both construction companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, profitability, dividends, analyst recommendations, institutional ownership, earnings and risk.
Dividends
KBR pays an annual dividend of $0.40 per share and has a dividend yield of 1.3%. Quanta Services pays an annual dividend of $0.24 per share and has a dividend yield of 0.3%. KBR pays out 23.7% of its earnings in the form of a dividend. Quanta Services pays out 7.9% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. KBR has raised its dividend for 1 consecutive years and Quanta Services has raised its dividend for 1 consecutive years.
Profitability
This table compares KBR and Quanta Services' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
KBR | -0.57% | 13.98% | 4.62% |
Quanta Services | 3.45% | 11.61% | 5.61% |
Analyst Recommendations
This is a breakdown of recent ratings and target prices for KBR and Quanta Services, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
---|
KBR | 0 | 0 | 9 | 0 | 3.00 |
Quanta Services | 0 | 3 | 8 | 0 | 2.73 |
KBR currently has a consensus target price of $32.7273, indicating a potential upside of 6.85%. Quanta Services has a consensus target price of $65.6364, indicating a potential downside of 15.48%. Given KBR's stronger consensus rating and higher probable upside, analysts clearly believe KBR is more favorable than Quanta Services.
Institutional and Insider Ownership
98.2% of KBR shares are owned by institutional investors. Comparatively, 86.5% of Quanta Services shares are owned by institutional investors. 1.0% of KBR shares are owned by insiders. Comparatively, 1.4% of Quanta Services shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Earnings & Valuation
This table compares KBR and Quanta Services' gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
KBR | $5.64 billion | 0.77 | $202 million | $1.69 | 18.12 |
Quanta Services | $12.11 billion | 0.89 | $402.04 million | $3.05 | 25.46 |
Quanta Services has higher revenue and earnings than KBR. KBR is trading at a lower price-to-earnings ratio than Quanta Services, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
KBR has a beta of 1.39, indicating that its share price is 39% more volatile than the S&P 500. Comparatively, Quanta Services has a beta of 1.24, indicating that its share price is 24% more volatile than the S&P 500.
Summary
Quanta Services beats KBR on 9 of the 16 factors compared between the two stocks.