Critical Analysis: Tecnoglass (NYSE:TGLS) versus MasterBrand (NYSE:MBC)

MasterBrand (NYSE:MBC) and Tecnoglass (NYSE:TGLS) are both small-cap industrials companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, institutional ownership, dividends, risk, analyst recommendations, earnings and valuation.

Valuation & Earnings

This table compares MasterBrand and Tecnoglass”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MasterBrand	$2.73 billion	0.54	$26.70 million	($0.69)	-10.50
Tecnoglass	$1.05 billion	1.50	$159.57 million	$2.84	12.50

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

Profitability

This table compares MasterBrand and Tecnoglass’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
MasterBrand	-3.49%	3.65%	1.60%
Tecnoglass	12.35%	17.84%	10.14%

Institutional & Insider Ownership

87.3% of MasterBrand shares are held by institutional investors. Comparatively, 37.3% of Tecnoglass shares are held by institutional investors. 2.8% of MasterBrand shares are held by company insiders. Comparatively, 0.1% of Tecnoglass shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current ratings and price targets for MasterBrand and Tecnoglass, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MasterBrand	1	1	0	0	1.50
Tecnoglass	2	0	3	0	2.20

MasterBrand currently has a consensus price target of $10.00, indicating a potential upside of 38.03%. Tecnoglass has a consensus price target of $63.33, indicating a potential upside of 78.33%. Given Tecnoglass’ stronger consensus rating and higher possible upside, analysts clearly believe Tecnoglass is more favorable than MasterBrand.

Summary

Tecnoglass beats MasterBrand on 10 of the 13 factors compared between the two stocks.

About MasterBrand

MasterBrand, Inc. engages in the manufacture and sale of residential cabinets in the United States and Canada. The company offers a range of residential cabinetry products for the kitchen, bathroom, and other parts of the home. It sells its products to remodeling and new construction markets through dealers, retailers, and builders. The company was formerly known as United Cabinet Incorporated. MasterBrand, Inc. was founded in 1954 and is headquartered in Beachwood, Ohio.

About Tecnoglass

Tecnoglass Inc., through its subsidiaries, designs, produces, markets, and installs architectural systems for the commercial and residential construction industries in Colombia, the United States, Panama, and internationally. The company offers low emissivity, laminated/thermo-laminated, thermo-acoustic, tempered, silk-screened, curved, and digital print glass products. It also provides aluminum products, including bars, plates, profiles, rods, and tubes that are used in the manufacture of architectural glass settings, such as windows, doors, spatial separators, and related products. In addition, the company offers curtain wall/floating facades, windows and doors, interior dividers and commercial display windows, hurricane-proof windows, and stick facade systems; and other products comprising awnings, structures, automatic doors, and other components of architectural systems. It markets and sells its products primarily under the Tecnoglass, ESWindows, and Alutions brands through internal and independent sales representatives, as wells as directly to distributors. The company was founded in 1984 and is headquartered in Barranquilla, Colombia. Tecnoglass Inc. is a subsidiary of Energy Holding Corporation.