Reviewing IES (NASDAQ:IESC) and Granite Construction (NYSE:GVA)

Granite Construction (NYSE:GVA) and IES (NASDAQ:IESC) are both industrials companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, valuation, analyst recommendations, earnings, institutional ownership, risk and dividends.

Profitability

This table compares Granite Construction and IES’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Granite Construction	-3.32%	27.83%	7.17%
IES	11.40%	35.70%	19.68%

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Granite Construction and IES, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Granite Construction	2	1	2	1	2.33
IES	0	1	2	0	2.67

Granite Construction currently has a consensus target price of $158.50, indicating a potential upside of 36.79%. IES has a consensus target price of $277.25, indicating a potential downside of 13.94%. Given Granite Construction’s higher probable upside, research analysts plainly believe Granite Construction is more favorable than IES.

Earnings and Valuation

This table compares Granite Construction and IES”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Granite Construction	$4.42 billion	1.15	$193.00 million	($4.31)	-26.88
IES	$3.37 billion	3.81	$303.06 million	$11.26	28.61

IES has lower revenue, but higher earnings than Granite Construction. Granite Construction is trading at a lower price-to-earnings ratio than IES, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

86.6% of IES shares are held by institutional investors. 0.9% of Granite Construction shares are held by company insiders. Comparatively, 56.4% of IES shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

Granite Construction has a beta of 1.32, suggesting that its stock price is 32% more volatile than the S&P 500. Comparatively, IES has a beta of 1.78, suggesting that its stock price is 78% more volatile than the S&P 500.

Summary

IES beats Granite Construction on 11 of the 14 factors compared between the two stocks.

About Granite Construction

Granite Construction Incorporated operates as an infrastructure contractor in the United States. It operates through two segments: Construction and Materials segments. The Construction segment engages in the construction and rehabilitation of roads, pavement preservation, bridges, rail lines, airports, marine ports, dams, reservoirs, aqueducts, infrastructure, and site development for use by the public and water-related construction for municipal agencies, commercial water suppliers, industrial facilities, and energy companies; and construction of various complex projects, including infrastructure/site development, mining, public safety, tunnel, solar storage, and power related projects. The Materials segment is involved in the production of aggregates, asphalt concrete, liquid asphalt, and recycled materials production for internal use in our construction projects and sale to third parties. It also offers site preparation, mining, and infrastructure services for residential development, energy development, commercial and industrial sites, railways, residential development, and energy development; and provides construction management professional services. It serves federal agencies, state departments of transportation, local transit authorities, county and city public works departments, school districts and developers, utilities, contractors, landscapers, manufacturers of products requiring aggregate materials, retailers, homeowners, farmers, brokers, and private owners of industrial, commercial, and residential sites. Granite Construction Incorporated was incorporated in 1922 and is headquartered in Watsonville, California.

About IES

IES Holdings, Inc. engages in the design and installation of integrated electrical and technology systems, and provides infrastructure products and services in the United States. The Communications segment designs, installs, and maintains network infrastructure within data centers for co-location and managed hosting customers; corporate, educational, financial, hospitality, and healthcare buildings; e-commerce distribution centers; and high-tech manufacturing facilities. This segment also provides design and installation services for audio/visual, telephone, fire, and wireless access and intrusion alarm systems; and engages in designing/building, servicing, and maintaining data network systems. The Residential segment offers electrical installations to single-family housing and multi-family apartments; and cable television installations to residential and light commercial applications, as well as installs residential solar power for new construction and existing residences. The Infrastructure Solutions segment maintains and repairs alternating and direct current electric motors and generators, and power generating and distribution equipment; manufactures custom-engineered metal enclosed bus duct solutions used in power distribution; manufactures custom commercial and industrial generator enclosures; manufactures, re-manufactures, and repairs industrial lifting magnets; and maintains and repairs railroad main and auxiliary generators, main alternators, and traction motors. The Commercial & Industrial segment offers electrical and mechanical design, construction, and maintenance services for office buildings, manufacturing facilities, data centers, chemical plants, refineries, wind farms, solar facilities, municipal infrastructures, and health care facilities. The company was formerly known as Integrated Electrical Services, Inc. and changed its name to IES Holdings, Inc. in May 2016. IES Holdings, Inc. was incorporated in 1997 and is headquartered in Houston, Texas.