Critical Review: Home Product Center Public (OTCMKTS:HPCRF) & Home Depot (NYSE:HD)

Home Product Center Public (OTCMKTS:HPCRF) and Home Depot (NYSE:HD) are both consumer cyclical companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, profitability, dividends, risk, analyst recommendations, earnings and institutional ownership.

Profitability

This table compares Home Product Center Public and Home Depot’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Home Product Center Public	N/A	N/A	N/A
Home Depot	10.48%	1,424.89%	21.21%

Institutional and Insider Ownership

3.4% of Home Product Center Public shares are held by institutional investors. Comparatively, 68.3% of Home Depot shares are held by institutional investors. 0.2% of Home Depot shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Home Product Center Public and Home Depot, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Home Product Center Public	0	0	0	0	N/A
Home Depot	0	13	15	0	2.54

Home Depot has a consensus target price of $339.62, indicating a potential upside of 3.03%. Given Home Depot’s higher probable upside, analysts plainly believe Home Depot is more favorable than Home Product Center Public.

Earnings & Valuation

This table compares Home Product Center Public and Home Depot’s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Home Product Center Public	N/A	N/A	N/A	$0.26	1.50
Home Depot	$154.88 billion	2.13	$17.11 billion	$16.01	20.59

Home Depot has higher revenue and earnings than Home Product Center Public. Home Product Center Public is trading at a lower price-to-earnings ratio than Home Depot, indicating that it is currently the more affordable of the two stocks.

Dividends

Home Product Center Public pays an annual dividend of $0.03 per share and has a dividend yield of 7.0%. Home Depot pays an annual dividend of $8.36 per share and has a dividend yield of 2.5%. Home Product Center Public pays out 10.4% of its earnings in the form of a dividend. Home Depot pays out 52.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Home Depot has increased its dividend for 14 consecutive years. Home Product Center Public is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Home Depot beats Home Product Center Public on 11 of the 13 factors compared between the two stocks.

About Home Product Center Public

Home Product Center Public Company Limited operates as a home improvement retailer in Thailand, Malaysia, and Vietnam. The company trades in goods and materials for construction, extension, refurbishment, renovation, and improvement of buildings, houses, and residences; and range of related services. It also offers 3D, installation, maintenance, home makeover, cleaning, warehousing, and distribution services. In addition, the company leases space. Home Product Center Public Company Limited was founded in 1995 and is headquartered in Nonthaburi, Thailand.

About Home Depot

The Home Depot, Inc. operates as a home improvement retailer. It sells various building materials, home improvement products, lawn and garden products, and décor products, as well as facilities maintenance, repair, and operations products. The company also offers installation services for flooring, water heaters, bath, garage doors, cabinets, cabinet makeovers, countertops, sheds, furnaces and central air systems, and windows. In addition, it provides tool and equipment rental services. The company primarily serves homeowners; and professional renovators/remodelers, general contractors, maintenance professionals, handymen, property managers, and building service contractors, as well as specialty tradesmen, such as electricians, plumbers, and painters. It also sells its products through websites, including homedepot.com; homedepot.ca and homedepot.com.mx; blinds.com, an online site for custom window coverings; and thecompanystore.com, an online site for textiles and décor products, as well as through The Home Depot stores. The Home Depot, Inc. was incorporated in 1978 and is based in Atlanta, Georgia.