Head to Head Comparison: UFP Industries (NASDAQ:UFPI) versus Potlatch (NASDAQ:PCH)

UFP Industries (NASDAQ:UFPI) and Potlatch (NASDAQ:PCH) are both mid-cap construction companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, earnings, risk, profitability, valuation and dividends.

Analyst Ratings

This is a summary of recent recommendations and price targets for UFP Industries and Potlatch, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
UFP Industries	0	1	3	0	2.75
Potlatch	0	1	6	0	2.86

UFP Industries presently has a consensus target price of $143.00, suggesting a potential upside of 43.17%. Potlatch has a consensus target price of $48.57, suggesting a potential upside of 23.43%. Given UFP Industries’ higher possible upside, equities research analysts plainly believe UFP Industries is more favorable than Potlatch.

Volatility & Risk

UFP Industries has a beta of 1.49, indicating that its stock price is 49% more volatile than the S&P 500. Comparatively, Potlatch has a beta of 1.17, indicating that its stock price is 17% more volatile than the S&P 500.

Earnings and Valuation

This table compares UFP Industries and Potlatch”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
UFP Industries	$6.65 billion	0.91	$414.56 million	$6.11	16.35
Potlatch	$1.06 billion	2.91	$21.88 million	$0.61	64.51

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

Dividends

UFP Industries pays an annual dividend of $1.40 per share and has a dividend yield of 1.4%. Potlatch pays an annual dividend of $1.80 per share and has a dividend yield of 4.6%. UFP Industries pays out 22.9% of its earnings in the form of a dividend. Potlatch pays out 295.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. UFP Industries has increased its dividend for 5 consecutive years.

Profitability

This table compares UFP Industries and Potlatch’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
UFP Industries	5.64%	11.78%	9.06%
Potlatch	4.35%	2.36%	1.46%

Insider & Institutional Ownership

81.8% of UFP Industries shares are owned by institutional investors. Comparatively, 86.1% of Potlatch shares are owned by institutional investors. 2.6% of UFP Industries shares are owned by company insiders. Comparatively, 1.0% of Potlatch shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

UFP Industries beats Potlatch on 11 of the 17 factors compared between the two stocks.

About UFP Industries

UFP Industries, Inc., through its subsidiaries, designs, manufactures, and markets wood and non-wood composites, and other materials in North America, Europe, Asia, and Australia. It operates through Retail, Packaging, and Construction segments. The Retail segment offers treated lumber products, including decking, fencing, lattice, and other products; pressure-treated and fire-retardant products used primarily for outdoor decking environments; and lawn and garden products, consisting of wood and vinyl fencing options, garden beds and planters, pergolas, picnic tables, and other landscaping products. This segment also offers wood plastic composites, composite decking, and related decking accessories, including non- aluminum railing systems, balusters, post caps, and other products, as well as pre-painted and primed shiplap and project boards. The Packaging segment provides custom and structural packaging products, pallets, corrugate, foam, labels, strapping, and films. The construction segment offers roof trusses, cut-to-size dimensional and board lumber, plywoods, and oriented strand boards; engineered wood components, including roof and floor trusses, wall panels, I-joists, and lumber packages; and alternate materials components, such as metal trusses, sheathed and pre-finished light gauge metal wall panels, aluminum decks, and rail accessories, as well as distributes siding, electrical, and plumbing products. This segment also engages in the manufacture of components; design, manufacture, and supply of wood forms and related products to set or form concrete for structures, such as parking garages, stadiums, and other infrastructure projects. It also offers interior fixtures, millwork, and casework for retail and commercial structures. The company was formerly known as Universal Forest Products, Inc. and changed its name to UFP Industries, Inc. in April 2020. UFP Industries, Inc. was incorporated in 1955 and is headquartered in Grand Rapids, Michigan.

About Potlatch

PotlatchDeltic Corporation (Nasdaq: PCH) is a leading Real Estate Investment Trust (REIT) that owns nearly 2.2 million acres of timberlands in Alabama, Arkansas, Georgia, Idaho, Louisiana, Mississippi and South Carolina. Through its taxable REIT subsidiary, the company also operates six sawmills, an industrial-grade plywood mill, a residential and commercial real estate development business and a rural timberland sales program. PotlatchDeltic, a leader in sustainable forest management, is committed to environmental and social responsibility and to responsible governance.