Financial Contrast: Argan (NYSE:AGX) versus Bellway (OTCMKTS:BLWYY)

Argan (NYSE:AGX) and Bellway (OTCMKTS:BLWYY) are both construction companies, but which is the superior business? We will contrast the two businesses based on the strength of their valuation, profitability, institutional ownership, earnings, dividends, risk and analyst recommendations.

Profitability

This table compares Argan and Bellway’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Argan	15.48%	36.89%	14.64%
Bellway	N/A	N/A	N/A

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Argan and Bellway, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Argan	0	3	4	1	2.75
Bellway	1	3	0	0	1.75

Argan currently has a consensus price target of $470.40, indicating a potential downside of 38.43%. Given Argan’s stronger consensus rating and higher probable upside, analysts plainly believe Argan is more favorable than Bellway.

Insider and Institutional Ownership

79.4% of Argan shares are owned by institutional investors. 6.7% of Argan shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Argan	$1.04 billion	10.28	$137.77 million	$11.38	67.14
Bellway	$3.62 billion	0.98	$204.69 million	N/A	N/A

Bellway has higher revenue and earnings than Argan.

Risk & Volatility

Argan has a beta of 0.59, meaning that its stock price is 41% less volatile than the S&P 500. Comparatively, Bellway has a beta of 0.14, meaning that its stock price is 86% less volatile than the S&P 500.

Dividends

Argan pays an annual dividend of $2.00 per share and has a dividend yield of 0.3%. Bellway pays an annual dividend of $0.50 per share and has a dividend yield of 1.6%. Argan pays out 17.6% of its earnings in the form of a dividend. Argan has increased its dividend for 2 consecutive years.

Summary

Argan beats Bellway on 12 of the 16 factors compared between the two stocks.

About Argan

Argan, Inc., through its subsidiaries, provides engineering, procurement, construction, commissioning, maintenance, project development, and technical consulting services to the power generation market. The company operates through Power Services, Industrial Services, and Telecom Services segments. The Power Services segment offers engineering, procurement, and construction, as well as designing, building, and commissioning of large-scale energy projects to the owners of alternative energy facilities, such as biomass plants, wind farms, and solar fields; and design, construction, project management, start-up, and operation services for projects with approximately 18 gigawatts of power-generating capacity. This segment serves independent power project owners, public utilities, power plant equipment suppliers, and other commercial firms. The Industrial Services segment provides industrial construction and field services and vessel fabrication services for fertilizer, engineering and construction, forest products, and various other industrial companies in southeast region of the United States. The Telecom Services segment offers trenchless directional boring and excavation for underground communication and power networks, as well as aerial cabling services; and installs buried cable, high and low voltage electric lines, and private area outdoor lighting systems. It also provides structured cabling, terminations, and connectivity that offers the physical transport for high-speed data, voice, video, and security networks. This segment serves electricity cooperative, state and local government agencies, counties and municipalities, and technology-oriented government contracting firms, as well as federal government facilities in the mid-Atlantic region of the United States. Argan, Inc. was incorporated in 1961 and is headquartered in Rockville, Maryland.

About Bellway

Bellway p.l.c., together with its subsidiaries, engages in the home building business in the United Kingdom. The company builds and sells homes ranging from one-bedroom apartments to six-bedroom family homes, as well as provides homes to housing associations for social housing. It offers homes under Bellway and Ashberry brands. Bellway p.l.c. was incorporated in 1978 and is headquartered in Newcastle upon Tyne, the United Kingdom.