Forterra (NASDAQ: FRTA) and USG Corporation (NYSE:USG) are both construction companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, risk, earnings, dividends, valuation, analyst recommendations and institutional ownership.

Profitability

This table compares Forterra and USG Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Forterra -4.72% -45.03% -3.19%
USG Corporation 14.94% 13.57% 6.20%

Valuation and Earnings

This table compares Forterra and USG Corporation’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Forterra $1.57 billion 0.22 $160.18 million N/A N/A
USG Corporation $3.08 billion 1.55 $487.00 million $3.10 10.72

USG Corporation has higher revenue and earnings than Forterra.

Analyst Ratings

This is a summary of recent recommendations and price targets for Forterra and USG Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Forterra 0 6 3 0 2.33
USG Corporation 2 12 1 0 1.93

Forterra presently has a consensus target price of $14.06, suggesting a potential upside of 163.34%. USG Corporation has a consensus target price of $30.93, suggesting a potential downside of 6.95%. Given Forterra’s stronger consensus rating and higher possible upside, research analysts clearly believe Forterra is more favorable than USG Corporation.

Insider & Institutional Ownership

87.0% of USG Corporation shares are owned by institutional investors. 0.3% of Forterra shares are owned by company insiders. Comparatively, 0.7% of USG Corporation shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

USG Corporation beats Forterra on 8 of the 11 factors compared between the two stocks.

Forterra Company Profile

Forterra, Inc. is a manufacturer of pipe and precast products. The Company offers products for a range of water-related infrastructure applications, including water transmission, distribution and drainage. The Company operates approximately 95 facilities. Its products are available in the United States and Eastern Canada.

USG Corporation Company Profile

USG Corporation, through its subsidiaries, is a manufacturer and distributor of building materials. The Company’s segments include Gypsum, Ceilings and USG Boral Building Products (UBBP). It produces a range of products for use in new residential, new nonresidential, and residential and nonresidential repair and remodel construction, as well as products used in certain industrial processes. Its products are distributed through building materials dealers, home improvement centers and other retailers, specialty wallboard distributors, and contractors. Gypsum segment manufactures and markets gypsum and related products in the United States, Canada, Mexico and Latin America. Ceilings segment manufactures and markets interior systems products in the United States, Canada, Mexico and Latin America. The UBBP segment manufactures, distributes and sells certain building products, mines raw gypsum and sells natural and synthetic gypsum throughout Asia, Australasia and the Middle East.

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