BlueLinx Holdings (NYSE: BXC) and GMS (NYSE:GMS) are both small-cap construction companies, but which is the superior business? We will contrast the two businesses based on the strength of their dividends, institutional ownership, risk, earnings, profitability, analyst recommendations and valuation.
Insider & Institutional Ownership
74.5% of BlueLinx Holdings shares are owned by institutional investors. Comparatively, 56.2% of GMS shares are owned by institutional investors. 2.3% of BlueLinx Holdings shares are owned by insiders. Comparatively, 5.9% of GMS shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
This table compares BlueLinx Holdings and GMS’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Valuation and Earnings
This table compares BlueLinx Holdings and GMS’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|BlueLinx Holdings||$1.88 billion||0.04||$16.08 million||$2.17||4.21|
|GMS||$2.32 billion||0.60||$48.88 million||$1.32||25.78|
GMS has higher revenue and earnings than BlueLinx Holdings. BlueLinx Holdings is trading at a lower price-to-earnings ratio than GMS, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
BlueLinx Holdings has a beta of 2.24, meaning that its share price is 124% more volatile than the S&P 500. Comparatively, GMS has a beta of 3.14, meaning that its share price is 214% more volatile than the S&P 500.
This is a breakdown of recent ratings and target prices for BlueLinx Holdings and GMS, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
GMS has a consensus target price of $36.83, indicating a potential upside of 8.24%. Given GMS’s higher possible upside, analysts clearly believe GMS is more favorable than BlueLinx Holdings.
GMS beats BlueLinx Holdings on 11 of the 13 factors compared between the two stocks.
BlueLinx Holdings Company Profile
BlueLinx Holdings, Inc. is a distributor of building products in North America. The Company operates its distribution business through a network of approximately 40 distribution centers. It serves metropolitan areas in the United States and delivers building products to a range of wholesale and retail customers. The Company distributes products in approximately two categories, such as structural products and specialty products. Structural products include plywood, oriented strand board (OSB), rebar and remesh, lumber and other wood products primarily used for structural support, walls and flooring in construction projects. Specialty products include roofing, insulation, specialty panels, molding, engineered wood products, vinyl products (used primarily in siding), outdoor living, particle board and metal products (excluding rebar and remesh). It also provides a range of services and solutions, such as intermodal distribution services; inventory stocking, and backhaul services.
GMS Company Profile
GMS Inc. is a distributor of wallboard and suspended ceilings systems, or ceilings. The Company provides a product offering of over 20,000 stock keeping units (SKUs) of wallboard, ceilings and complementary interior construction products for interior contractors. It offers steel framing and ancillary products for its customers. Its Wallboard is a building product for interior and exterior walls and ceilings in residential and commercial structures. Its ceilings product line consists of suspended mineral fiber, soft fiber and metal ceiling systems primarily used in offices, hotels, hospitals, retail facilities, schools and a range of other commercial and institutional buildings. Its steel framing product line consists of steel track, studs and various other steel products used to frame the interior walls of a commercial or institutional building. It supplies complementary products, including insulation, ready-mix-joint compound and various other interior construction products.
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