Head-To-Head Contrast: Smith-Midland (NASDAQ:SMID) and James Hardie Industries (NYSE:JHX)

Smith-Midland (NASDAQ:SMID) and James Hardie Industries (NYSE:JHX) are both construction companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, risk, institutional ownership, profitability, analyst recommendations, valuation and dividends.

Profitability

This table compares Smith-Midland and James Hardie Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Smith-Midland	1.90%	3.03%	1.82%
James Hardie Industries	13.58%	39.32%	14.38%

Institutional and Insider Ownership

40.7% of Smith-Midland shares are owned by institutional investors. Comparatively, 1.5% of James Hardie Industries shares are owned by institutional investors. 5.0% of Smith-Midland shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Smith-Midland and James Hardie Industries’ top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Smith-Midland	$50.13 million	1.92	$800,000.00	$0.19	96.48
James Hardie Industries	$3.78 billion	3.30	$512.00 million	$1.14	24.86

James Hardie Industries has higher revenue and earnings than Smith-Midland. James Hardie Industries is trading at a lower price-to-earnings ratio than Smith-Midland, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Smith-Midland has a beta of 0.88, suggesting that its share price is 12% less volatile than the S&P 500. Comparatively, James Hardie Industries has a beta of 1.43, suggesting that its share price is 43% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and recommmendations for Smith-Midland and James Hardie Industries, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Smith-Midland	0	0	0	0	N/A
James Hardie Industries	1	2	2	0	2.20

James Hardie Industries has a consensus price target of $29.80, indicating a potential upside of 5.15%. Given James Hardie Industries’ higher possible upside, analysts plainly believe James Hardie Industries is more favorable than Smith-Midland.

Summary

James Hardie Industries beats Smith-Midland on 10 of the 13 factors compared between the two stocks.

About Smith-Midland

Smith-Midland Corporation, through its subsidiaries, invents, develops, manufactures, markets, leases, licenses, sells, and installs precast concrete products and systems primarily for use in the construction, highway, utilities, and farming industries. It offers SlenderWall, a patented, lightweight, energy efficient concrete and steel exterior wall panel for use in building construction; Sierra Wall that provides sound and sight barrier for use alongside highways around residential, industrial, and commercial properties; J-J Hooks highway safety barriers for use on roadways to separate lanes of traffic in construction work zone or traffic control purposes; and Easi-Set precast building and Easi-Span expandable precast buildings for use in housing communications operations, traffic control systems, and mechanical and electrical stations. The company also provides Easi-Set utility vaults for house equipment, such as cable, telephone, or traffic signal equipment, and for underground storage, as well as custom-built utility vaults for special needs; SoftSound soundwall panels to absorb highway noise; Beach Prisms, an erosion control module for seawalls and jetties; and H2Out secondary drainage systems for panelized exterior cladding. In addition, it licenses its proprietary products in the United States, Canada, Australia, Belgium, Mexico, New Zealand, and Trinidad. The company markets its products through in-house sales force and independent sales representatives to contractors performing public and private construction contracts, such as construction of commercial buildings, public and private roads and highways, airports, and municipal utilities; and federal, state, and local transportation authorities. Smith-Midland Corporation was founded in 1960 and is based in Midland, Virginia.

About James Hardie Industries

James Hardie Industries plc manufactures and sells fiber cement, fiber gypsum, and cement bonded building products for interior and exterior building construction applications primarily in the United States, Australia, Europe, New Zealand, and the Philippines. The company operates through North America Fiber Cement, Asia Pacific Fiber Cement, and Europe Building Products segments. It offers fiber cement interior linings, exterior siding products, and related accessories; and various fiber cement products for a range of applications, including external cladding, internal walls, ceilings, floors, soffits, fences, and facades. The company also provides fiber gypsum and cement-bonded boards for use in the timber frame construction, dry lining, DIY, and structural fire protection applications. Its products are used in residential repair and remodel, and commercial and residential new construction markets James Hardie Industries plc was founded in 1888 and is based in Dublin, Ireland.