Layne Christensen (NASDAQ:LAYN) versus Great Lakes Dredge & Dock Corporation (GLDD) Critical Review

Great Lakes Dredge & Dock Corporation (NASDAQ: GLDD) and Layne Christensen (NASDAQ:LAYN) are both small-cap construction companies, but which is the better stock? We will compare the two companies based on the strength of their analyst recommendations, institutional ownership, valuation, profitability, dividends, risk and earnings.

Volatility and Risk

Great Lakes Dredge & Dock Corporation has a beta of 0.77, suggesting that its stock price is 23% less volatile than the S&P 500. Comparatively, Layne Christensen has a beta of 0.32, suggesting that its stock price is 68% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for Great Lakes Dredge & Dock Corporation and Layne Christensen, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Great Lakes Dredge & Dock Corporation 0 0 1 0 3.00
Layne Christensen 0 2 0 0 2.00

Great Lakes Dredge & Dock Corporation currently has a consensus price target of $6.50, suggesting a potential upside of 68.83%. Layne Christensen has a consensus price target of $9.00, suggesting a potential downside of 6.93%. Given Great Lakes Dredge & Dock Corporation’s stronger consensus rating and higher probable upside, research analysts plainly believe Great Lakes Dredge & Dock Corporation is more favorable than Layne Christensen.

Valuation & Earnings

This table compares Great Lakes Dredge & Dock Corporation and Layne Christensen’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Great Lakes Dredge & Dock Corporation $759.72 million 0.31 $76.18 million ($0.32) -12.03
Layne Christensen $592.83 million 0.32 $8.28 million ($3.34) -2.90

Great Lakes Dredge & Dock Corporation has higher revenue and earnings than Layne Christensen. Great Lakes Dredge & Dock Corporation is trading at a lower price-to-earnings ratio than Layne Christensen, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

72.3% of Great Lakes Dredge & Dock Corporation shares are held by institutional investors. Comparatively, 91.0% of Layne Christensen shares are held by institutional investors. 8.2% of Great Lakes Dredge & Dock Corporation shares are held by insiders. Comparatively, 12.0% of Layne Christensen shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Great Lakes Dredge & Dock Corporation and Layne Christensen’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Great Lakes Dredge & Dock Corporation -2.62% 1.00% 0.28%
Layne Christensen -11.98% -31.94% -6.75%

Summary

Great Lakes Dredge & Dock Corporation beats Layne Christensen on 10 of the 13 factors compared between the two stocks.

Great Lakes Dredge & Dock Corporation Company Profile

Great Lakes Dredge & Dock Corporation is a provider of dredging services. The Company provides dredging services in the East, West and Gulf Coasts of the United States and around the world. It operates in two segments: Dredging Operations, which involves enhancement or preservation of navigability of waterways or the protection of shorelines through the removal or replenishment of soil, sand or rock, and Environmental & Remediation Operations, which provides construction services on soil, water and sediment for clients in both the public and private sectors. It has interest in Amboy Aggregates, which is involved in mining sand from the entrance channel to New York Harbor for providing sand and aggregate for use in road and building construction, and for clean land fill; Lower Main Street Development, LLC (Lower Main), which is engaged in land development and sale business, and TerraSea Environmental Solutions (TerraSea), which is engaged in the environmental services business.

Layne Christensen Company Profile

Layne Christensen Company (Layne) is a water management, construction and drilling company. The Company provides drilling solutions for water management, mineral services and specialty drilling needs. The Company operates through three segments: Water Resources, Inliner and Mineral Services. Its Water Resources segment provides its customers with solutions for various aspects of water supply system development and technology throughout the United States. Its Inliner segment is a service rehabilitation company offering a range of solutions for wastewater, storm water and process sewer pipeline networks. Its Mineral Services conducts ground drilling activities, including core drilling, reverse circulation, dual tube, hammer and rotary air-blast methods.

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