Head-To-Head Survey: Construction Partners (NASDAQ:ROAD) vs. Stantec (NYSE:STN)

Stantec (NYSE:STN) and Construction Partners (NASDAQ:ROAD) are both mid-cap industrials companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, dividends, risk, institutional ownership, profitability and valuation.

Valuation and Earnings

This table compares Stantec and Construction Partners”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Stantec	$5.83 billion	1.39	$343.11 million	$3.12	23.06
Construction Partners	$2.81 billion	2.40	$101.78 million	$2.55	46.81

Stantec has higher revenue and earnings than Construction Partners. Stantec 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 Stantec and Construction Partners’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Stantec	5.92%	19.37%	8.03%
Construction Partners	4.10%	16.06%	4.59%

Institutional and Insider Ownership

63.9% of Stantec shares are owned by institutional investors. Comparatively, 94.8% of Construction Partners shares are owned by institutional investors. 0.5% of Stantec shares are owned by company insiders. Comparatively, 15.7% of Construction Partners shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Volatility and Risk

Stantec has a beta of 0.99, indicating that its stock price is 1% less volatile than the S&P 500. Comparatively, Construction Partners has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Stantec and Construction Partners, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Stantec	0	2	5	0	2.71
Construction Partners	0	3	4	1	2.75

Stantec presently has a consensus target price of $175.00, indicating a potential upside of 143.22%. Construction Partners has a consensus target price of $133.50, indicating a potential upside of 11.85%. Given Stantec’s higher possible upside, analysts plainly believe Stantec is more favorable than Construction Partners.

Summary

Stantec beats Construction Partners on 9 of the 15 factors compared between the two stocks.

About Stantec

Stantec Inc. provides professional services in the areas of infrastructure and facilities to the public and private sectors in Canada, the United States, and internationally. It offers evaluation, planning, and designing infrastructure solutions; solutions for sustainable water resources, planning, management, and infrastructure; environmental services; integrated architecture, engineering, interior design, and planning solutions for buildings; and energy and resources solutions. The company also provides consulting services in engineering, architecture, interior design, landscape architecture, surveying, environmental sciences, project management, and project economics. In addition, it offers planning and design services to clients in residential, logistics, retail, infrastructure, energy, higher education, and urban regeneration sectors; architectural and interior design, and planning services in the science and technology, commercial workplace, higher education, residential, and hospitality markets. Further, the company provides transportation advisory, transport engineering, and technical design; project delivery consultancy services for mining, resources, and industrial infrastructure projects; paleontological and archaeological services for the rail, transportation, water, and power and energy sectors; and environmental and cultural resource compliance services. Additionally, it offers consulting services in sustainable building design, energy infrastructure upgrades, sustainable district heating network, and e-mobility; and planning, design, construction administration, commissioning, maintenance, decommissioning, and remediation services. The company was formerly known as Stanley Technology Group Inc. and changed its name to Stantec Inc. in October 1998. Stantec Inc. was founded in 1954 and is headquartered in Edmonton, Canada.

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.