UFP Industries (NASDAQ:UFPI) versus BlueLinx (NYSE:BXC) Critical Analysis

UFP Industries (NASDAQ:UFPI) and BlueLinx (NYSE:BXC) are both construction companies, but which is the better business? We will compare the two businesses based on the strength of their dividends, valuation, analyst recommendations, institutional ownership, profitability, risk and earnings.

Volatility and Risk

UFP Industries has a beta of 1.43, suggesting that its share price is 43% more volatile than the S&P 500. Comparatively, BlueLinx has a beta of 1.74, suggesting that its share price is 74% more volatile than the S&P 500.

Insider & Institutional Ownership

81.8% of UFP Industries shares are owned by institutional investors. Comparatively, 90.8% of BlueLinx shares are owned by institutional investors. 2.6% of UFP Industries shares are owned by company insiders. Comparatively, 3.4% of BlueLinx 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.

Valuation & Earnings

This table compares UFP Industries and BlueLinx”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
UFP Industries	$6.65 billion	0.92	$414.56 million	$5.76	18.22
BlueLinx	$2.95 billion	0.22	$53.12 million	$3.37	24.89

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
UFP Industries	5.31%	10.95%	8.48%
BlueLinx	0.96%	3.48%	1.39%

Analyst Ratings

This is a summary of recent ratings and target prices for UFP Industries and BlueLinx, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
UFP Industries	1	1	2	0	2.25
BlueLinx	0	1	2	0	2.67

UFP Industries currently has a consensus price target of $134.00, indicating a potential upside of 27.67%. BlueLinx has a consensus price target of $91.00, indicating a potential upside of 8.47%. Given UFP Industries’ higher possible upside, analysts plainly believe UFP Industries is more favorable than BlueLinx.

Summary

UFP Industries beats BlueLinx on 8 of the 13 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 BlueLinx

BlueLinx Holdings Inc., together with its subsidiaries, engages in the distribution of residential and commercial building products in the United States. It distributes specialty products, including engineered wood, siding, millwork, outdoor living, specialty lumber and panels, and industrial products; and structural products, such as lumber, plywood, oriented strand boards, rebars and remesh, as well as other wood products that are used for structural support in construction projects. It also provides various value-added services and solutions to customers and suppliers. The company serves national home centers, pro dealers, cooperatives, specialty distributors, regional and local dealers, and industrial manufacturers. BlueLinx Holdings Inc. was incorporated in 2004 and is headquartered in Marietta, Georgia.