Analyzing Gafisa (OTCMKTS:GFASY) and M/I Homes (NYSE:MHO)

Gafisa (OTCMKTS:GFASY) and M/I Homes (NYSE:MHO) are both construction companies, but which is the better business? We will compare the two companies based on the strength of their valuation, institutional ownership, analyst recommendations, risk, profitability, dividends and earnings.

Earnings & Valuation

This table compares Gafisa and M/I Homes”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Gafisa	N/A	N/A	N/A	N/A	N/A
M/I Homes	$4.48 billion	0.74	$563.72 million	$17.03	7.45

M/I Homes has higher revenue and earnings than Gafisa.

Profitability

This table compares Gafisa and M/I Homes’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Gafisa	N/A	N/A	N/A
M/I Homes	10.56%	15.72%	10.26%

Analyst Recommendations

This is a summary of current ratings and recommmendations for Gafisa and M/I Homes, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Gafisa	0	0	0	0	0.00
M/I Homes	0	2	1	2	3.00

M/I Homes has a consensus price target of $155.00, indicating a potential upside of 22.15%. Given M/I Homes’ stronger consensus rating and higher probable upside, analysts plainly believe M/I Homes is more favorable than Gafisa.

Risk and Volatility

Gafisa has a beta of 0.5, suggesting that its stock price is 50% less volatile than the S&P 500. Comparatively, M/I Homes has a beta of 1.66, suggesting that its stock price is 66% more volatile than the S&P 500.

Insider & Institutional Ownership

95.1% of M/I Homes shares are owned by institutional investors. 3.1% of Gafisa shares are owned by insiders. Comparatively, 3.5% of M/I Homes shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Summary

M/I Homes beats Gafisa on 11 of the 11 factors compared between the two stocks.

About Gafisa

Gafisa S.A. operates as a development and construction company under the Gafisa brand name in Brazil. The company is involved in residential, commercial, and hotel projects. It also provides technical consultancy services, and real estate management and construction services to third parties. Gafisa S.A. was founded in 1954 and is headquartered in São Paulo, Brazil.

About M/I Homes

M/I Homes, Inc., together with its subsidiaries, engages in the construction and sale of single-family residential homes in Ohio, Indiana, Illinois, Minnesota, Michigan, Florida, Texas, North Carolina, and Tennessee. The company operates through Northern Homebuilding, Southern Homebuilding, and Financial Services segments. It also designs, constructs, markets, and sells single-family homes and attached townhomes to first-time, millennial, move-up, empty-nester, multi-generational, and luxury homebuyers under the M/I Homes brand name. In addition, the company purchases undeveloped land to develop into developed lots for the construction of single-family homes, as well as for sale to others. Further, the company originates and sells mortgages; and serves as a title insurance agent by providing title insurance policies, examination, and closing services to purchasers of its homes. M/I Homes, Inc. was founded in 1976 and is based in Columbus, Ohio.