Reviewing Forestar Group (NYSE:FOR) & Next (OTCMKTS:NXCLF)

Next (OTCMKTS:NXCLF) and Forestar Group (NYSE:FOR) are both small-cap real estate companies, but which is the better stock? We will contrast the two companies based on the strength of their analyst recommendations, valuation, institutional ownership, risk, earnings, dividends and profitability.

Valuation & Earnings

This table compares Next and Forestar Group”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Next	$188.62 million	1.07	$35.62 million	$0.12	13.17
Forestar Group	$1.66 billion	0.89	$167.90 million	$3.33	8.69

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

Profitability

This table compares Next and Forestar Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Next	11.36%	12.27%	8.03%
Forestar Group	9.88%	9.42%	5.36%

Analyst Ratings

This is a summary of current ratings and recommmendations for Next and Forestar Group, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Next	0	0	0	0	0.00
Forestar Group	0	4	2	0	2.33

Forestar Group has a consensus price target of $32.67, indicating a potential upside of 12.88%. Given Forestar Group’s stronger consensus rating and higher possible upside, analysts plainly believe Forestar Group is more favorable than Next.

Institutional & Insider Ownership

35.5% of Forestar Group shares are held by institutional investors. 0.5% of Forestar Group 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.

Volatility and Risk

Next has a beta of -0.14, indicating that its stock price is 114% less volatile than the S&P 500. Comparatively, Forestar Group has a beta of 1.41, indicating that its stock price is 41% more volatile than the S&P 500.

Summary

Forestar Group beats Next on 9 of the 14 factors compared between the two stocks.

About Next

LIFULL Co.,Ltd. provides real estate information services in Japan and internationally. It offers LIFULL HOME'S, a site of real estate and housing information; LIFULL Revitalize Rural Japan that suggests new lifestyles to people in Japan based on the refurbishment of abandoned houses; LIFULL Move, which provides rankings and reviews of moving companies; LIFULL Nursing Care, a special care facility searching web service; and LIFULL Investment, a money lending website. The company also provides LIFULL FaM that enables working mothers balance childcare with work while pursuing a career; LIFULL Storage, a storage space searching web service; LIFULL HUB, a shared office; LIFULL Fab for design and craftsmanship; and LIFULL Table, a gallery and open space for photography, exhibitions, press releases, and workshops. In addition, it offers LivingAnywhere Commons, a community to live; instant house products; Trovit, an aggregation website providing information on items, including real estate and housing, used cars, recruitment, and mail orders; and Mitula, a site that provides information in real estate and housing, used cars, recruitment, and fashion. The company was formerly known as NEXT Co., Ltd. and changed its name to LIFULL Co.,Ltd. in April 2017. LIFULL Co.,Ltd. was founded in 1995 and is headquartered in Tokyo, Japan.

About Forestar Group

Forestar Group Inc. operates as a residential lot development company in the United States. The company acquires land and develops infrastructure for single-family residential communities. It sells its residential single-family finished lots to local, regional, and national homebuilders. The company was incorporated in 2005 and is headquartered in Arlington, Texas. Forestar Group Inc. operates as a subsidiary of D.R. Horton, Inc.