Analyzing Aspen Aerogels (NYSE:ASPN) & Argan (NYSE:AGX)

Argan (NYSE:AGX) and Aspen Aerogels (NYSE:ASPN) are both construction companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, dividends, risk, institutional ownership, profitability and valuation.

Earnings & Valuation

This table compares Argan and Aspen Aerogels”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Argan	$874.18 million	5.63	$85.46 million	$8.32	42.82
Aspen Aerogels	$452.70 million	0.66	$13.38 million	($3.72)	-0.98

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

Profitability

This table compares Argan and Aspen Aerogels’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Argan	12.73%	32.61%	14.29%
Aspen Aerogels	-86.52%	-0.20%	-0.13%

Volatility and Risk

Argan has a beta of 0.6, indicating that its stock price is 40% less volatile than the S&P 500. Comparatively, Aspen Aerogels has a beta of 2.95, indicating that its stock price is 195% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Argan and Aspen Aerogels, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Argan	0	4	4	0	2.50
Aspen Aerogels	3	2	4	1	2.30

Argan presently has a consensus target price of $310.17, indicating a potential downside of 12.93%. Aspen Aerogels has a consensus target price of $12.67, indicating a potential upside of 247.99%. Given Aspen Aerogels’ higher possible upside, analysts plainly believe Aspen Aerogels is more favorable than Argan.

Institutional and Insider Ownership

79.4% of Argan shares are owned by institutional investors. Comparatively, 97.6% of Aspen Aerogels shares are owned by institutional investors. 6.7% of Argan shares are owned by company insiders. Comparatively, 4.3% of Aspen Aerogels shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Argan beats Aspen Aerogels on 10 of the 14 factors compared between the two stocks.

About Argan

Argan, Inc., through its subsidiaries, provides engineering, procurement, construction, commissioning, maintenance, project development, and technical consulting services to the power generation market. The company operates through Power Services, Industrial Services, and Telecom Services segments. The Power Services segment offers engineering, procurement, and construction, as well as designing, building, and commissioning of large-scale energy projects to the owners of alternative energy facilities, such as biomass plants, wind farms, and solar fields; and design, construction, project management, start-up, and operation services for projects with approximately 18 gigawatts of power-generating capacity. This segment serves independent power project owners, public utilities, power plant equipment suppliers, and other commercial firms. The Industrial Services segment provides industrial construction and field services and vessel fabrication services for fertilizer, engineering and construction, forest products, and various other industrial companies in southeast region of the United States. The Telecom Services segment offers trenchless directional boring and excavation for underground communication and power networks, as well as aerial cabling services; and installs buried cable, high and low voltage electric lines, and private area outdoor lighting systems. It also provides structured cabling, terminations, and connectivity that offers the physical transport for high-speed data, voice, video, and security networks. This segment serves electricity cooperative, state and local government agencies, counties and municipalities, and technology-oriented government contracting firms, as well as federal government facilities in the mid-Atlantic region of the United States. Argan, Inc. was incorporated in 1961 and is headquartered in Rockville, Maryland.

About Aspen Aerogels

Aspen Aerogels, Inc. designs, develops, manufactures, and sells aerogel insulation products primarily for use in the energy infrastructure and sustainable insulation materials markets in the United States, Asia, Canada, Europe, and Latin America. It operates in two segments, Energy Industrial and Thermal Barrier. The company offers PyroThin thermal barriers for use in lithium-ion batteries in electric vehicles and energy storage industries; Pyrogel XTE that reduces the risk of corrosion under insulation in energy infrastructure operating systems; and Pyrogel HPS for applications within the power generation market. It also offers Pyrogel XTF to provide protection against fire; Cryogel Z for sub-ambient and cryogenic applications in the energy infrastructure market; Spaceloft Subsea for use in pipe-in-pipe applications in offshore oil production; and Cryogel X201, which is used in designing cold systems, such as refrigerated appliances, cold storage equipment, and aerospace systems. The company was founded in 2001 and is headquartered in Northborough, Massachusetts.