Magnera (NYSE:MAGN) and AECOM (NYSE:ACM) Critical Review

Magnera (NYSE:MAGN) and AECOM (NYSE:ACM) are both construction companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, dividends, risk, earnings and valuation.

Earnings & Valuation

This table compares Magnera and AECOM”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Magnera	$3.20 billion	0.13	-$159.00 million	($1.96)	-5.73
AECOM	$15.99 billion	0.57	$561.77 million	$3.83	18.59

AECOM has higher revenue and earnings than Magnera. Magnera is trading at a lower price-to-earnings ratio than AECOM, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Magnera has a beta of 1.78, indicating that its share price is 78% more volatile than the S&P 500. Comparatively, AECOM has a beta of 0.93, indicating that its share price is 7% less volatile than the S&P 500.

Insider & Institutional Ownership

76.9% of Magnera shares are held by institutional investors. Comparatively, 85.4% of AECOM shares are held by institutional investors. 1.0% of Magnera shares are held by insiders. Comparatively, 0.5% of AECOM shares are held 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.

Profitability

This table compares Magnera and AECOM’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Magnera	-3.37%	-10.30%	-2.77%
AECOM	3.16%	28.52%	6.08%

Analyst Ratings

This is a summary of recent recommendations and price targets for Magnera and AECOM, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Magnera	1	2	0	0	1.67
AECOM	0	4	9	0	2.69

Magnera presently has a consensus price target of $14.50, suggesting a potential upside of 29.22%. AECOM has a consensus price target of $116.00, suggesting a potential upside of 62.89%. Given AECOM’s stronger consensus rating and higher possible upside, analysts plainly believe AECOM is more favorable than Magnera.

Summary

AECOM beats Magnera on 12 of the 14 factors compared between the two stocks.

About Magnera

Magnera’s purpose is to better the world with new possibilities made real. By continuously co-creating and innovating with our partners, we develop original material solutions that make a brighter future possible. With a breadth of technologies and a passion for what we create, Magnera’s solutions propel our customers’ goals forward and solve end-users’ problems, every day.

About AECOM

AECOM, together with its subsidiaries, provides professional infrastructure consulting services worldwide. It operates in three segments: Americas, International, and AECOM Capital. The company offers planning, consulting, architectural and engineering design, construction and program management, and investment and development services to public and private clients. It is also involved in the investment and development of real estate projects. In addition, the company provides construction services, including building construction and energy, and infrastructure and industrial construction. It serves transportation, water, government, facilities, environmental, and energy sectors. The company was formerly known as AECOM Technology Corporation and changed its name to AECOM in January 2015. AECOM was incorporated in 1980 and is headquartered in Dallas, Texas.