Contrasting Builders FirstSource (NYSE:BLDR) & Tile Shop Hldgs (NASDAQ:TTSH)

Builders FirstSource (NYSE:BLDR) and Tile Shop Hldgs (NASDAQ:TTSH) are both retail/wholesale companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, dividends, profitability, valuation, earnings, institutional ownership and risk.

Volatility & Risk

Builders FirstSource has a beta of 1.69, suggesting that its share price is 69% more volatile than the S&P 500. Comparatively, Tile Shop Hldgs has a beta of 1.07, suggesting that its share price is 7% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Builders FirstSource and Tile Shop Hldgs, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Builders FirstSource	0	4	15	1	2.85
Tile Shop Hldgs	0	0	0	0	0.00

Builders FirstSource currently has a consensus price target of $163.11, indicating a potential upside of 29.03%. Given Builders FirstSource’s stronger consensus rating and higher probable upside, equities analysts plainly believe Builders FirstSource is more favorable than Tile Shop Hldgs.

Earnings and Valuation

This table compares Builders FirstSource and Tile Shop Hldgs”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Builders FirstSource	$16.40 billion	0.85	$1.08 billion	$7.80	16.21
Tile Shop Hldgs	$347.07 million	0.90	$2.32 million	$0.02	349.00

Builders FirstSource has higher revenue and earnings than Tile Shop Hldgs. Builders FirstSource is trading at a lower price-to-earnings ratio than Tile Shop Hldgs, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Builders FirstSource and Tile Shop Hldgs’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Builders FirstSource	5.66%	28.02%	11.18%
Tile Shop Hldgs	0.23%	0.65%	0.25%

Insider and Institutional Ownership

95.5% of Builders FirstSource shares are owned by institutional investors. Comparatively, 36.7% of Tile Shop Hldgs shares are owned by institutional investors. 2.0% of Builders FirstSource shares are owned by insiders. Comparatively, 36.7% of Tile Shop Hldgs shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Summary

Builders FirstSource beats Tile Shop Hldgs on 12 of the 15 factors compared between the two stocks.

About Builders FirstSource

Builders FirstSource, Inc., together with its subsidiaries, manufactures and supplies building materials, manufactured components, and construction services to professional homebuilders, sub-contractors, remodelers, and consumers in the United States. It offers lumber and lumber sheet goods comprising dimensional lumber, plywood, and oriented strand board products that are used in on-site house framing; manufactured products, such as wood floor and roof trusses, floor trusses, wall panels, stairs, and engineered wood products; and windows, and interior and exterior door units, as well as interior trims and custom products comprising intricate mouldings, stair parts, and columns under the Synboard brand name. The company also provides specialty building products and services, including vinyl, composite and wood siding, exterior trims, metal studs, cement, roofing, insulation, wallboards, ceilings, cabinets, and hardware products; turn-key framing, shell construction, design assistance, and professional installation services. In addition, it offers software products, such as drafting, estimating, quoting, and virtual home design services, which provide software solutions to retailers, distributors, manufacturers, and homebuilders. The company was formerly known as BSL Holdings, Inc. and changed its name to Builders FirstSource, Inc. in October 1999. Builders FirstSource, Inc. was incorporated in 1998 and is based in Irving, Texas.

About Tile Shop Hldgs

Tile Shop Holdings, Inc. operates as a specialty retailer of natural stone and man-made tiles, setting and maintenance materials, and related accessories in the United States. The company offers natural stone products, including marble, travertine, granite, quartz, sandstone, slate, and onyx tiles; and man-made products, comprises ceramic, porcelain, glass, cement, wood look, and metal and luxury vinyl tile. It also manufactures setting and maintenance materials, such as thinset, grout, and sealers; and accessories which includes installation tools, shower and bath shelves, drains, and related products. In addition, the company offers customers delivery service through third-party freight providers. It sells its products under the Superior Adhesives & Chemicals, Superior Tools & Supplies, Rush River, and Fired Earth brands. Tile Shop Holdings, Inc. was founded in 1985 and is headquartered in Plymouth, Minnesota.