Construction Partners (NASDAQ:ROAD – Get Free Report) and Latham Group (NASDAQ:SWIM – Get Free Report) are both construction companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, profitability, risk, dividends, earnings and valuation.
Volatility and Risk
Construction Partners has a beta of 0.88, suggesting that its share price is 12% less volatile than the S&P 500. Comparatively, Latham Group has a beta of 1.71, suggesting that its share price is 71% more volatile than the S&P 500.
Valuation and Earnings
This table compares Construction Partners and Latham Group”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Construction Partners | $2.81 billion | 2.14 | $101.78 million | $1.83 | 58.22 |
| Latham Group | $508.52 million | 1.56 | -$17.86 million | ($0.10) | -67.80 |
Construction Partners has higher revenue and earnings than Latham Group. Latham Group is trading at a lower price-to-earnings ratio than Construction Partners, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Construction Partners and Latham Group’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Construction Partners | 3.62% | 14.42% | 4.25% |
| Latham Group | -2.07% | -2.80% | -1.34% |
Analyst Recommendations
This is a summary of recent ratings and target prices for Construction Partners and Latham Group, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Construction Partners | 0 | 2 | 3 | 2 | 3.00 |
| Latham Group | 2 | 1 | 0 | 0 | 1.33 |
Construction Partners presently has a consensus target price of $123.50, suggesting a potential upside of 15.92%. Latham Group has a consensus target price of $7.44, suggesting a potential upside of 9.70%. Given Construction Partners’ stronger consensus rating and higher probable upside, analysts plainly believe Construction Partners is more favorable than Latham Group.
Institutional and Insider Ownership
94.8% of Construction Partners shares are owned by institutional investors. Comparatively, 84.0% of Latham Group shares are owned by institutional investors. 16.4% of Construction Partners shares are owned by company insiders. Comparatively, 8.6% of Latham Group shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Summary
Construction Partners beats Latham Group on 14 of the 15 factors compared between the two stocks.
About Construction Partners
Construction Partners, Inc., a civil infrastructure company, constructs and maintains roadways in Alabama, Florida, Georgia, North Carolina, South Carolina, and Tennessee. The company provides various products and services to public and private infrastructure projects, such as highways, roads, bridges, airports, and commercial and residential developments. It also engages in manufacturing and distributing hot mix asphalt (HMA) for internal use and sales to third parties in connection with construction projects; and paving activities, including the construction of roadway base layers and application of asphalt pavement. In addition, the company is involved in site development, including the installation of utility and drainage systems; mining aggregates, such as sand, gravel, and construction stones that are used as raw materials in the production of HMA; and distributing liquid asphalt cement for internal use and sales to third parties in connection with HMA production. The company was formerly known as SunTx CPI Growth Company, Inc. and changed its name to Construction Partners, Inc. in September 2017. Construction Partners, Inc. was founded in 2007 and is headquartered in Dothan, Alabama.
About Latham Group
Latham Group, Inc. designs, manufactures, and markets in-ground residential swimming pools in North America, Australia, and New Zealand. It offers a portfolio of pools and related products, including in-ground swimming pools that include fiber glass and packaged pools; and pool covers and liners under the Latham, Narellan, CoverStar, Radiant, and GLI brand names. The company was formerly known as Latham Topco, Inc. and changed its name to Latham Group, Inc. in March 2021. Latham Group, Inc. was founded in 1956 and is headquartered in Latham, New York.
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