Knife River (NYSE:KNF) & Installed Building Products (NYSE:IBP) Financial Analysis

Knife River (NYSE:KNF) and Installed Building Products (NYSE:IBP) are both mid-cap construction companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, risk, analyst recommendations, earnings, dividends, profitability and institutional ownership.

Insider & Institutional Ownership

80.1% of Knife River shares are owned by institutional investors. Comparatively, 99.6% of Installed Building Products shares are owned by institutional investors. 0.3% of Knife River shares are owned by company insiders. Comparatively, 16.2% of Installed Building Products shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Risk and Volatility

Knife River has a beta of 0.63, meaning that its stock price is 37% less volatile than the S&P 500. Comparatively, Installed Building Products has a beta of 1.73, meaning that its stock price is 73% more volatile than the S&P 500.

Profitability

This table compares Knife River and Installed Building Products’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Knife River	5.20%	10.58%	4.85%
Installed Building Products	8.45%	60.27%	13.91%

Valuation and Earnings

This table compares Knife River and Installed Building Products”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Knife River	$2.90 billion	1.76	$201.68 million	$2.69	33.48
Installed Building Products	$2.94 billion	2.49	$256.60 million	$8.99	29.80

Installed Building Products has higher revenue and earnings than Knife River. Installed Building Products is trading at a lower price-to-earnings ratio than Knife River, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings for Knife River and Installed Building Products, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Knife River	0	0	6	0	3.00
Installed Building Products	2	9	2	0	2.00

Knife River currently has a consensus price target of $114.3333, indicating a potential upside of 26.95%. Installed Building Products has a consensus price target of $217.3636, indicating a potential downside of 18.87%. Given Knife River’s stronger consensus rating and higher possible upside, research analysts clearly believe Knife River is more favorable than Installed Building Products.

Summary

Installed Building Products beats Knife River on 10 of the 14 factors compared between the two stocks.

About Knife River

Knife River Corporation, together with its subsidiaries, provides aggregates- led construction materials and contracting services in the United States. It operates through Pacific, Northwest, Mountain, Central, and Energy Services segments. The company mines, processes, and sells construction aggregates, including crushed stone and sand, and gravel; and produces and sells asphalt and ready-mix concrete. It also provides contracting service, such as heavy-civil construction, asphalt and concrete paving, and site development and grading. In addition, the company sells cement, merchandise, and other building materials and related services. The company sells its construction materials to public and private-sector customers, including federal, state, and municipal governments, as well as industrial, commercial and residential developers, and other private parties; and provides its contracting services to public-sector customers for the development and servicing of highways, local roads, bridges, and other public-infrastructure projects. Knife River Corporation was founded in 1917 and is based in Bismarck, North Dakota.

About Installed Building Products

Installed Building Products, Inc., together with its subsidiaries, engages in the installation of insulation, waterproofing, fire-stopping, fireproofing, garage doors, rain gutters, window blinds, shower doors, closet shelving and mirrors, and other products in the United States. It operates through Installation, Distribution, and Manufacturing operation segments. The company offers a range of insulation materials, such as fiberglass and cellulose, and spray foam insulation materials. It is also involved in the installation of insulation and sealant materials in various areas of a structure, which includes basement and crawl space, building envelope, attic, and acoustical applications. In addition, the company installs a range of caulk and sealant products that control air infiltration in residential and commercial buildings; and waterproofing options, including sheet and hot applied waterproofing membranes, as well as deck coating, bentonite, and air and vapor systems. Further, it distributes spray foam insulation, metal building insulation, residential insulation, and mechanical and fabricated Styrofoam insulation, as well as accessories and equipment used in the insulation installation process; and manufactures cellulose insulation and specialty industrial fibers. It serves homebuilders, multi-family and commercial and agricultural construction firms, individual homeowners, and repair and remodeling contractors. The company was formerly known as CCIB Holdco, Inc. Installed Building Products, Inc. was founded in 1977 and is based in Columbus, Ohio.