Grafton Group (OTCMKTS:GROUF) and Owens Corning (NYSE:OC) Critical Review

Grafton Group (OTCMKTS:GROUF) and Owens Corning (NYSE:OC) are both mid-cap construction companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, analyst recommendations, risk, institutional ownership, valuation, dividends and profitability.

Insider and Institutional Ownership

8.2% of Grafton Group shares are owned by institutional investors. Comparatively, 88.4% of Owens Corning shares are owned by institutional investors. 0.8% of Owens Corning shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Valuation & Earnings

This table compares Grafton Group and Owens Corning”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Grafton Group	$2.92 billion	0.81	$155.92 million	N/A	N/A
Owens Corning	$10.98 billion	0.85	$647.00 million	($5.72)	-19.87

Owens Corning has higher revenue and earnings than Grafton Group.

Risk & Volatility

Grafton Group has a beta of 0.38, meaning that its stock price is 62% less volatile than the S&P 500. Comparatively, Owens Corning has a beta of 1.34, meaning that its stock price is 34% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations for Grafton Group and Owens Corning, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Grafton Group	0	0	1	0	3.00
Owens Corning	2	5	10	0	2.47

Owens Corning has a consensus target price of $155.58, indicating a potential upside of 36.91%. Given Owens Corning’s higher probable upside, analysts clearly believe Owens Corning is more favorable than Grafton Group.

Profitability

This table compares Grafton Group and Owens Corning’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Grafton Group	N/A	N/A	N/A
Owens Corning	-4.46%	24.42%	8.53%

Summary

Owens Corning beats Grafton Group on 10 of the 12 factors compared between the two stocks.

About Grafton Group

Grafton Group plc engages in the distribution, retailing, and manufacturing businesses in Ireland, the Netherlands, Finland, and the United Kingdom. Its Distribution segment distributes building materials, paint, tools, ironmongery, fixings, and accessories, workwear and PPE, and spare parts; materials and plant for mechanical services, heating, plumbing, and air movement; and trade, DIY, and self-build markets with building materials, timber, doors and floors, plumbing and heating, bathrooms, and landscaping products under the Selco, Leyland SDM, Chadwicks, MacBlair, Isero, Polvo, Gunters en Meuser, TG Lynes, and IKH brands. The company’s Retailing segment retails home and garden products through stores, including DIY products, paints, lighting products, homestyle products, housewares, bathroom products, and kitchens, as well as gardening and Christmas products under the Woodie’s brand. Its Manufacturing segment manufactures dry mortars and wooden staircases; and drainage, ducting and roofline systems under the CPI Mortar, StairBox, and MFP brand names. Grafton Group plc was founded in 1902 and is based in Dublin, Ireland.

About Owens Corning

Owens Corning manufactures and sells building and construction materials in the United States, Europe, the Asia Pacific, and internationally. It operates in three segments: Roofing, Insulation, and Composites. The Roofing segment manufactures and sells laminate and strip asphalt roofing shingles, oxidized asphalt materials, and roofing components used in residential and commercial construction, and specialty applications. This segment sells its products through distributors, home centers, and lumberyards, as well as to roofing contractors for built-up roofing asphalt systems; and manufacturers in automotive, chemical, rubber, and construction industries. The Insulation segment manufactures and sells thermal and acoustical batts, loosefill insulation, spray foam insulation, foam sheathing and accessories under the Owens Corning PINK, and FIBERGLAS brands; and glass fiber pipe insulation, energy efficient flexible duct media, bonded and granulated mineral wool insulation, cellular glass insulation, and foam insulation under the FOAMULAR, FOAMGLAS, and Paroc brand names used in construction applications. This segment sells its products primarily to the insulation installers, home centers, lumberyards, retailers, and distributors. The Composites segment manufactures, fabricates, and sells glass reinforcements in the form of fiber; and glass fiber products in the form of fabrics, non-wovens, and composite lumber. Its products are used in building structures, roofing shingles, tubs and showers, pools, decking, flooring, pipes and tanks, poles, electrical equipment, and wind-energy turbine blades. This segment sells its products directly to parts molders, fabricators, and shingle manufacturers. The company was incorporated in 1938 and is headquartered in Toledo, Ohio.