Analyzing PulteGroup (NYSE:PHM) & Taylor Wimpey (OTCMKTS:TWODY)

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

Risk and Volatility

PulteGroup has a beta of 1.27, indicating that its stock price is 27% more volatile than the S&P 500. Comparatively, Taylor Wimpey has a beta of 1.63, indicating that its stock price is 63% more volatile than the S&P 500.

Earnings and Valuation

This table compares PulteGroup and Taylor Wimpey”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PulteGroup	$17.69 billion	1.53	$3.08 billion	$13.38	10.25
Taylor Wimpey	$4.37 billion	1.09	$433.99 million	N/A	N/A

PulteGroup has higher revenue and earnings than Taylor Wimpey.

Profitability

This table compares PulteGroup and Taylor Wimpey’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PulteGroup	15.50%	21.01%	14.73%
Taylor Wimpey	N/A	N/A	N/A

Institutional and Insider Ownership

89.9% of PulteGroup shares are held by institutional investors. 0.8% of PulteGroup 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.

Dividends

PulteGroup pays an annual dividend of $0.88 per share and has a dividend yield of 0.6%. Taylor Wimpey pays an annual dividend of $1.10 per share and has a dividend yield of 8.1%. PulteGroup pays out 6.6% of its earnings in the form of a dividend. PulteGroup has raised its dividend for 7 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings for PulteGroup and Taylor Wimpey, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PulteGroup	0	5	9	1	2.73
Taylor Wimpey	1	2	0	1	2.25

PulteGroup currently has a consensus target price of $136.46, indicating a potential downside of 0.50%. Given PulteGroup’s stronger consensus rating and higher probable upside, equities analysts plainly believe PulteGroup is more favorable than Taylor Wimpey.

Summary

PulteGroup beats Taylor Wimpey on 12 of the 15 factors compared between the two stocks.

About PulteGroup

PulteGroup, Inc., through its subsidiaries, primarily engages in the homebuilding business in the United States. It acquires and develops land primarily for residential purposes; and constructs housing on such land. The company also offers various home designs, including single-family detached, townhomes, condominiums, and duplexes under the Centex, Pulte Homes, Del Webb, DiVosta Homes, John Wieland Homes and Neighborhoods, and American West brand names. In addition, the company arranges financing through the origination of mortgage loans primarily for homebuyers; sells the servicing rights for the originated loans; and provides title insurance policies, and examination and closing services to homebuyers. PulteGroup, Inc. was founded in 1950 and is headquartered in Atlanta, Georgia.

About Taylor Wimpey

Taylor Wimpey plc operates as a homebuilder in the United Kingdom and Spain. It builds and delivers various homes and communities. Taylor Wimpey plc was incorporated in 1935 and is based in High Wycombe, the United Kingdom.