Fletcher Building (FCREY) and Its Peers Critical Review

Insider & Institutional Ownership

46.6% of shares of all “Construction Materials” companies are owned by institutional investors. 9.9% of shares of all “Construction Materials” companies are owned by 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.

Profitability

This table compares Fletcher Building and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fletcher Building	N/A	N/A	N/A
Fletcher Building Competitors	4.41%	8.31%	5.03%

Earnings and Valuation

This table compares Fletcher Building and its rivals revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Fletcher Building	N/A	N/A	3.23
Fletcher Building Competitors	$6.83 billion	$651.37 million	32.10

Fletcher Building’s rivals have higher revenue and earnings than Fletcher Building. Fletcher Building is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Dividends

Fletcher Building pays an annual dividend of $0.57 per share and has a dividend yield of 18.1%. Fletcher Building pays out 58.4% of its earnings in the form of a dividend. As a group, “Construction Materials” companies pay a dividend yield of 177.1% and pay out 31.6% of their earnings in the form of a dividend. Fletcher Building lags its rivals as a dividend stock, given its lower dividend yield and higher payout ratio.

Summary

Fletcher Building rivals beat Fletcher Building on 9 of the 9 factors compared.

Fletcher Building Company Profile

Fletcher Building Limited, together with its subsidiaries, manufactures and distributes building products in New Zealand, Australia, and internationally. It operates through Building Products, Distribution, Concrete, Residential and Development, Construction, and Australia segments. The Building Products segment manufactures, markets, and distributes building products used to build homes; and buildings and infrastructure, including insulations, plasterboards, laminate surfaces, and plastic and concrete piping for the commercial and residential markets. The Distribution segment distributes building, plumbing, and pipeline products under the PlaceMakers, Mico, and TUMU brands. The Concrete segment engages in the extraction of aggregates, and production of cement and concrete. The Residential and Development segment builds residential homes and apartments; and develops and sells residential and commercial land. The Construction segment builds and maintains public and commercial buildings, transport and utilities infrastructure, and buildings and infrastructure, as well as designs, constructs, and maintains roads and civil infrastructure. The Australia segment manufactures and distributes building materials, such as insulation, plasterboard, laminate surfaces, steel roofing, and plastic and concrete piping for a range of industries across Australia. The company was founded in 1909 and is headquartered in Auckland, New Zealand.