Reviewing Masco (NYSE:MAS) and Shimizu (OTCMKTS:SHMUY)

Shimizu (OTCMKTS:SHMUY) and Masco (NYSE:MAS) are both construction companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, dividends, earnings, profitability, risk and valuation.

Dividends

Shimizu pays an annual dividend of $0.76 per share and has a dividend yield of 1.7%. Masco pays an annual dividend of $1.24 per share and has a dividend yield of 1.8%. Shimizu pays out 19.3% of its earnings in the form of a dividend. Masco pays out 31.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Masco has increased its dividend for 12 consecutive years. Masco is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Profitability

This table compares Shimizu and Masco’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Shimizu	5.05%	3.76%	1.40%
Masco	10.89%	1,317.38%	16.47%

Risk & Volatility

Shimizu has a beta of 0.34, suggesting that its stock price is 66% less volatile than the S&P 500. Comparatively, Masco has a beta of 1.28, suggesting that its stock price is 28% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for Shimizu and Masco, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shimizu	0	0	0	0	0.00
Masco	0	13	6	1	2.40

Masco has a consensus price target of $73.00, indicating a potential upside of 5.20%. Given Masco’s stronger consensus rating and higher probable upside, analysts plainly believe Masco is more favorable than Shimizu.

Insider & Institutional Ownership

93.9% of Masco shares are owned by institutional investors. 0.5% of Masco shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Shimizu and Masco”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shimizu	$12.77 billion	0.64	$435.70 million	$3.94	11.08
Masco	$7.83 billion	1.84	$822.00 million	$3.90	17.79

Masco has lower revenue, but higher earnings than Shimizu. Shimizu is trading at a lower price-to-earnings ratio than Masco, indicating that it is currently the more affordable of the two stocks.

Summary

Masco beats Shimizu on 15 of the 18 factors compared between the two stocks.

About Shimizu

Shimizu Corporation, together with its subsidiaries, engages in the construction, development, engineering, and life cycle valuation businesses in Japan and internationally. The company proposes, plans, designs, builds, repairs, manages, operates, and maintains offices, plants, schools, hospitals, and other buildings, such as nursing homes, rehabilitation centers, temples, shrines, and architectures; offers design, build, and renovation for tunnels, bridges, dams, urban infrastructure, energy facilities, and other public works; provides construction for manufacturing facilities, high-rise buildings, hospitals, bridges, subways, and other projects; and develops and rents real estate properties, including condominiums, data centers, office buildings, logistics facilities, and other properties. It also offers engineering, procurement, and construction services in solar and wind power projects, environmental clean-up engineering, turn-key order fulfillment of plants, and ICT systems and engineering projects. In addition, the company provides facility operation and management services; infrastructure management, maintenance, and concession services; and generates power using renewable energy and sells electricity, as well as involved in commercialization of smart cities and provision of services using ICT technology. Further, it engages in the lease and sale of construction equipment and materials; provision of interior finishing and rebar works; insurance agency, security, and travel agency services; supply of PCR test kits; and rental of various tower cranes, crawler cranes, and other construction machinery and equipment. Additionally, the company offers construction equipment consulting services, such as construction planning, maintenance, and management services; property and building management services; and real estate consulting and brokerage services, as well as tenant leasing services. Shimizu Corporation was founded in 1804 and is headquartered in Tokyo, Japan.

About Masco

Masco Corporation designs, manufactures, and distributes home improvement and building products in North America, Europe, and internationally. The company's Plumbing Products segment offers faucets, showerheads, handheld showers, valves, bath hardware and accessories, bathing units, shower bases and enclosures, sinks, toilets, acrylic tubs, shower trays, spas, exercise pools, and fitness systems; brass, copper, and composite plumbing system components; connected water products; thermoplastic solutions, extruded plastic profiles, specialized fabrications, and PEX tubing products; and other non-decorative plumbing products. This segment provides its products under the DELTA, BRIZO, PEERLESS, HANSGROHE, AXOR, KRAUS, EASY DRAIN, STEAMIST, ELITESTEAM, GINGER, NEWPORT BRASS, BRASSTECH, WALTEC, BRISTAN, HERITAGE, MIROLIN, HOT SPRING, CALDERA, FREEFLOW SPAS, FANTASY SPAS, ENDLESS POOLS, BRASSCRAFT, PLUMB SHOP, COBRA, COBRA PRO, and MASTER PLUMBER brands. Its Decorative Architectural Products segment offers paints, primers, specialty coatings, stains, and waterproofing products, as well as paint applicators and accessories; cabinet and door hardware, functional hardware, wall plates, hook and rail products, closet organization systems, and picture hanging accessories; decorative bath hardware, mirrors, and shower accessories and doors; and decorative indoor and outdoor lighting fixtures, ceiling fans, landscape lighting, and LED lighting systems. This segment provides its products under the BEHR, KILZ, WHIZZ, Elder & Jenks, LIBERTY, BRAINERD, FRANKLIN BRASS, KICHLER, and ÉLAN brands. It sells its products to the plumbing, heating, and hardware wholesalers; home centers and online retailers; hardware stores; electrical and landscape distributors; lighting showrooms; building supply outlets; and other mass merchandisers. Masco Corporation was incorporated in 1929 and is headquartered in Livonia, Michigan.