Financial Analysis: Taylor Morrison Home (NYSE:TMHC) vs. Persimmon (OTCMKTS:PSMMY)

Taylor Morrison Home (NYSE:TMHC) and Persimmon (OTCMKTS:PSMMY) are both mid-cap construction companies, but which is the superior stock? We will compare the two businesses based on the strength of their dividends, valuation, institutional ownership, analyst recommendations, profitability, risk and earnings.

Insider and Institutional Ownership

95.2% of Taylor Morrison Home shares are held by institutional investors. 1.4% of Taylor Morrison Home shares are held by insiders. Comparatively, 0.6% of Persimmon shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Taylor Morrison Home and Persimmon’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Taylor Morrison Home	10.72%	16.22%	10.23%
Persimmon	N/A	N/A	N/A

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Taylor Morrison Home and Persimmon, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Taylor Morrison Home	0	0	8	1	3.11
Persimmon	0	1	2	1	3.00

Taylor Morrison Home currently has a consensus price target of $77.50, suggesting a potential upside of 17.73%. Given Taylor Morrison Home’s stronger consensus rating and higher possible upside, analysts plainly believe Taylor Morrison Home is more favorable than Persimmon.

Earnings and Valuation

This table compares Taylor Morrison Home and Persimmon”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Taylor Morrison Home	$8.17 billion	0.81	$883.31 million	$8.66	7.60
Persimmon	$4.09 billion	1.18	$341.33 million	N/A	N/A

Taylor Morrison Home has higher revenue and earnings than Persimmon.

Volatility & Risk

Taylor Morrison Home has a beta of 1.58, indicating that its stock price is 58% more volatile than the S&P 500. Comparatively, Persimmon has a beta of 1.27, indicating that its stock price is 27% more volatile than the S&P 500.

Summary

Taylor Morrison Home beats Persimmon on 11 of the 12 factors compared between the two stocks.

About Taylor Morrison Home

Taylor Morrison Home Corporation, together with its subsidiaries, operates as a public homebuilder in the United States. The company designs, builds, and sells single and multi-family detached and attached homes; and develops lifestyle and master-planned communities. It develops and constructs multi-use properties consisting of commercial space, retail, and multi-family properties under the Urban Form brand name. In addition, the company offers financial services, title insurance, and closing settlement services. It operates under the Taylor Morrison, Darling Homes Collection by Taylor Morrison, and Esplanade brand names in Arizona, California, Colorado, Florida, Georgia, Nevada, North and South Carolina, Oregon, Texas, and Washington. Taylor Morrison Home Corporation was founded in 1936 and is headquartered in Scottsdale, Arizona.

About Persimmon

Persimmon Plc, together with its subsidiaries, operates as a house builder in the United Kingdom. The company offers family housing under the Persimmon Homes brand name; housing under the Charles Church brand name; and social housing under the Westbury Partnerships brand name. It also provides broadband services under the FibreNest brand; and timber frame, insulated wall panels, and roof cassettes under the brand Space4. Further, it offers concrete bricks and roof tile. Persimmon Plc was founded in 1972 and is headquartered in York, the United Kingdom.