Construction Partners (NASDAQ:ROAD) and Latham Group (NASDAQ:SWIM) Head-To-Head Analysis

Construction Partners (NASDAQ:ROAD) and Latham Group (NASDAQ:SWIM) are both construction companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, institutional ownership, analyst recommendations, dividends, profitability, risk and earnings.

Insider & Institutional Ownership

94.8% of Construction Partners shares are held by institutional investors. Comparatively, 84.0% of Latham Group shares are held by institutional investors. 16.4% of Construction Partners shares are held by insiders. Comparatively, 6.9% of Latham Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of current recommendations for Construction Partners and Latham Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Construction Partners	0	3	2	2	2.86
Latham Group	2	1	2	0	2.00

Construction Partners presently has a consensus price target of $123.50, indicating a potential upside of 18.51%. Latham Group has a consensus price target of $7.95, indicating a potential upside of 11.19%. Given Construction Partners’ stronger consensus rating and higher possible upside, equities research analysts clearly believe Construction Partners is more favorable than Latham Group.

Valuation & Earnings

This table compares Construction Partners and Latham Group”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Construction Partners	$2.81 billion	2.09	$101.78 million	$1.83	56.95
Latham Group	$508.52 million	1.64	-$17.86 million	($0.10)	-71.50

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

Volatility and Risk

Construction Partners has a beta of 0.89, indicating that its share price is 11% less volatile than the S&P 500. Comparatively, Latham Group has a beta of 1.71, indicating that its share price is 71% more volatile than the S&P 500.

Profitability

This table compares Construction Partners and Latham Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Construction Partners	3.62%	14.42%	4.25%
Latham Group	-2.07%	-2.80%	-1.34%

Summary

Construction Partners beats Latham Group on 13 of the 14 factors compared between the two stocks.

About Construction Partners

Construction Partners, Inc., a civil infrastructure company, constructs and maintains roadways in Alabama, Florida, Georgia, North Carolina, South Carolina, and Tennessee. The company provides various products and services to public and private infrastructure projects, such as highways, roads, bridges, airports, and commercial and residential developments. It also engages in manufacturing and distributing hot mix asphalt (HMA) for internal use and sales to third parties in connection with construction projects; and paving activities, including the construction of roadway base layers and application of asphalt pavement. In addition, the company is involved in site development, including the installation of utility and drainage systems; mining aggregates, such as sand, gravel, and construction stones that are used as raw materials in the production of HMA; and distributing liquid asphalt cement for internal use and sales to third parties in connection with HMA production. The company was formerly known as SunTx CPI Growth Company, Inc. and changed its name to Construction Partners, Inc. in September 2017. Construction Partners, Inc. was founded in 2007 and is headquartered in Dothan, Alabama.

About Latham Group

Latham Group, Inc. designs, manufactures, and markets in-ground residential swimming pools in North America, Australia, and New Zealand. It offers a portfolio of pools and related products, including in-ground swimming pools that include fiber glass and packaged pools; and pool covers and liners under the Latham, Narellan, CoverStar, Radiant, and GLI brand names. The company was formerly known as Latham Topco, Inc. and changed its name to Latham Group, Inc. in March 2021. Latham Group, Inc. was founded in 1956 and is headquartered in Latham, New York.