Reviewing Stanley Black & Decker (NYSE:SWK) & M/I Homes (NYSE:MHO)

M/I Homes (NYSE:MHO) and Stanley Black & Decker (NYSE:SWK) are both consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, profitability, analyst recommendations, institutional ownership, earnings, risk and valuation.

Institutional & Insider Ownership

95.1% of M/I Homes shares are held by institutional investors. Comparatively, 87.8% of Stanley Black & Decker shares are held by institutional investors. 3.6% of M/I Homes shares are held by insiders. Comparatively, 0.7% of Stanley Black & Decker shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Profitability

This table compares M/I Homes and Stanley Black & Decker’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
M/I Homes	6.59%	10.12%	6.74%
Stanley Black & Decker	4.07%	8.78%	3.73%

Volatility and Risk

M/I Homes has a beta of 1.67, indicating that its share price is 67% more volatile than the S&P 500. Comparatively, Stanley Black & Decker has a beta of 1.15, indicating that its share price is 15% more volatile than the S&P 500.

Earnings and Valuation

This table compares M/I Homes and Stanley Black & Decker”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
M/I Homes	$4.42 billion	0.78	$402.94 million	$10.52	13.14
Stanley Black & Decker	$15.13 billion	1.18	$401.90 million	$4.10	28.90

M/I Homes has higher earnings, but lower revenue than Stanley Black & Decker. M/I Homes is trading at a lower price-to-earnings ratio than Stanley Black & Decker, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for M/I Homes and Stanley Black & Decker, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
M/I Homes	1	2	3	1	2.57
Stanley Black & Decker	1	7	5	0	2.31

M/I Homes currently has a consensus target price of $164.40, suggesting a potential upside of 18.89%. Stanley Black & Decker has a consensus target price of $94.82, suggesting a potential downside of 19.99%. Given M/I Homes’ stronger consensus rating and higher possible upside, analysts clearly believe M/I Homes is more favorable than Stanley Black & Decker.

Summary

M/I Homes beats Stanley Black & Decker on 11 of the 15 factors compared between the two stocks.

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.

About Stanley Black & Decker

Stanley Black & Decker, Inc. engages in the provision of power and hand tools, and related accessories, products, services and equipment for oil and gas, infrastructure applications, commercial electronic security and monitoring systems, healthcare solutions, and mechanical access solutions. It operates through the Tools and Outdoor and Industrial segments. The Tools and Outdoor segment refers to power tools, hand tools, accessories and storage, and outdoor power equipment product lines. The Industrial segment includes the engineered fastening and infrastructure businesses. The company was founded by Frederick T. Stanley in 1843 and is headquartered in New Britain, CT.