Financial Review: Grafton Group (OTCMKTS:GROUF) and CRH (NYSE:CRH)

Grafton Group (OTCMKTS:GROUF) and CRH (NYSE:CRH) are both construction companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, profitability, institutional ownership, valuation and earnings.

Analyst Ratings

This is a breakdown of current ratings and target prices for Grafton Group and CRH, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Grafton Group	0	0	1	0	3.00
CRH	0	3	13	2	2.94

CRH has a consensus target price of $139.54, indicating a potential upside of 18.93%. Given CRH’s higher possible upside, analysts clearly believe CRH is more favorable than Grafton Group.

Valuation & Earnings

This table compares Grafton Group and CRH”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Grafton Group	$3.32 billion	0.73	$180.09 million	N/A	N/A
CRH	$37.45 billion	2.09	$3.73 billion	$5.52	21.26

CRH has higher revenue and earnings than Grafton Group.

Volatility and Risk

Grafton Group has a beta of 0.37, suggesting that its stock price is 63% less volatile than the S&P 500. Comparatively, CRH has a beta of 1.35, suggesting that its stock price is 35% more volatile than the S&P 500.

Profitability

This table compares Grafton Group and CRH’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Grafton Group	N/A	N/A	N/A
CRH	10.02%	15.98%	6.78%

Insider & Institutional Ownership

8.2% of Grafton Group shares are owned by institutional investors. Comparatively, 62.5% of CRH shares are owned by institutional investors. 0.1% of CRH 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

CRH beats Grafton Group on 12 of the 13 factors compared between the two stocks.

About Grafton Group

Grafton Group plc engages in the distribution, retailing, and manufacturing businesses in Ireland, the Netherlands, Finland, and the United Kingdom. Its Distribution segment distributes building materials, paint, tools, ironmongery, fixings, and accessories, workwear and PPE, and spare parts; materials and plant for mechanical services, heating, plumbing, and air movement; and trade, DIY, and self-build markets with building materials, timber, doors and floors, plumbing and heating, bathrooms, and landscaping products under the Selco, Leyland SDM, Chadwicks, MacBlair, Isero, Polvo, Gunters en Meuser, TG Lynes, and IKH brands. The company’s Retailing segment retails home and garden products through stores, including DIY products, paints, lighting products, homestyle products, housewares, bathroom products, and kitchens, as well as gardening and Christmas products under the Woodie’s brand. Its Manufacturing segment manufactures dry mortars and wooden staircases; and drainage, ducting and roofline systems under the CPI Mortar, StairBox, and MFP brand names. Grafton Group plc was founded in 1902 and is based in Dublin, Ireland.

About CRH

CRH plc, together with its subsidiaries, provides building materials solutions in Ireland and internationally. It operates through four segments: Americas Materials Solutions, Americas Building Solutions, Europe Materials Solutions, and Europe Building Solutions. The company provides solutions for the construction and maintenance of public infrastructure and commercial and residential buildings; and produces and sells aggregates, cement, readymixed concrete, and asphalt, as well as provides paving and construction services. It also manufactures, supplies, and delivers solutions for the built environment in communities across North America; and offers building and infrastructure solutions serving complex critical utility infrastructure, such as water, energy, transportation, and telecommunications projects, and outdoor living solutions for enhancing private and public spaces. In addition, the company combines materials, products, and services to produce a wide range of architectural and infrastructural solutions for use in the building and renovation of critical utility infrastructure, commercial and residential buildings, and outdoor living spaces for the built environment. Further, it produces and supplies precast and pre-stressed concrete products comprising floor and wall elements, beams, vaults, pipes, and manholes; granite, limestone, and sandstone; concrete and polymer-based products, such as underground vaults, drainage systems, utility enclosures, and modular precast structures; engineered steel, polymer-based anchoring, fixing, and connecting solutions; concrete masonry, hardscape and related products, including pavers, blocks and curbs, retaining walls, and slabs; and fencing and railing systems, composite decking, lawn and garden products, and packaged concrete mixes. The company was founded in 1936 and is headquartered in Dublin, Ireland.