Analyzing Green Brick Partners (NASDAQ:GRBK) & Somnigroup International (NYSE:SGI)

Green Brick Partners (NASDAQ:GRBK) and Somnigroup International (NYSE:SGI) are both consumer discretionary companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, dividends, institutional ownership, earnings, analyst recommendations, risk and valuation.

Insider & Institutional Ownership

78.2% of Green Brick Partners shares are held by institutional investors. Comparatively, 99.9% of Somnigroup International shares are held by institutional investors. 30.3% of Green Brick Partners shares are held by insiders. Comparatively, 4.0% of Somnigroup International shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Volatility & Risk

Green Brick Partners has a beta of 1.7, suggesting that its stock price is 70% more volatile than the S&P 500. Comparatively, Somnigroup International has a beta of 1.3, suggesting that its stock price is 30% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Green Brick Partners and Somnigroup International, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Green Brick Partners	0	3	0	0	2.00
Somnigroup International	0	2	9	0	2.82

Somnigroup International has a consensus target price of $93.33, indicating a potential upside of 49.76%. Given Somnigroup International’s stronger consensus rating and higher possible upside, analysts plainly believe Somnigroup International is more favorable than Green Brick Partners.

Profitability

This table compares Green Brick Partners and Somnigroup International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Green Brick Partners	17.70%	25.35%	17.29%
Somnigroup International	6.62%	17.84%	5.04%

Earnings and Valuation

This table compares Green Brick Partners and Somnigroup International”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Green Brick Partners	$1.98 billion	1.33	$284.63 million	$6.22	10.00
Somnigroup International	$7.48 billion	1.75	$384.10 million	$2.50	24.93

Somnigroup International has higher revenue and earnings than Green Brick Partners. Green Brick Partners is trading at a lower price-to-earnings ratio than Somnigroup International, indicating that it is currently the more affordable of the two stocks.

Summary

Somnigroup International beats Green Brick Partners on 8 of the 14 factors compared between the two stocks.

About Green Brick Partners

Green Brick Partners, Inc. is a homebuilding and land development company that operates through a network of regional builders and real estate businesses. Its activities include acquiring and developing land, constructing homes, and marketing them to homebuyers. The company serves markets in Texas, Georgia, Colorado and Florida. Its homebuilding brands include Trophy Signature Homes, CB JENI Homes, Normandy Homes, Southgate Homes, The Providence Group, Challenger Homes and GHO Homes. Green Brick traces its roots to 2006 and became a publicly traded company in 2014.

About Somnigroup International

Somnigroup International, Inc. is a bedding company that designs, manufactures, distributes and sells mattresses and related sleep products. Its offerings include adjustable bases, pillows and other bedding accessories, marketed under brands such as Tempur-Pedic, Sealy and Stearns & Foster. The company also operates Mattress Firm, a mattress retailer with stores across the United States. Through its brands, retail business and other sales channels, Somnigroup serves customers in the U.S. and international markets.