Sonos (NASDAQ:SONO – Get Free Report) and Installed Building Products (NYSE:IBP – Get Free Report) are both consumer discretionary companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, risk, earnings, profitability, analyst recommendations, dividends and valuation.
Risk and Volatility
Sonos has a beta of 1.93, indicating that its share price is 93% more volatile than the S&P 500. Comparatively, Installed Building Products has a beta of 1.71, indicating that its share price is 71% more volatile than the S&P 500.
Valuation and Earnings
This table compares Sonos and Installed Building Products”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sonos | $1.44 billion | 1.31 | -$61.14 million | $0.45 | 35.51 |
| Installed Building Products | $2.97 billion | 2.11 | $265.40 million | $9.29 | 25.36 |
Installed Building Products has higher revenue and earnings than Sonos. Installed Building Products is trading at a lower price-to-earnings ratio than Sonos, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares Sonos and Installed Building Products’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Sonos | 3.82% | 19.10% | 8.67% |
| Installed Building Products | 8.46% | 42.12% | 13.20% |
Insider and Institutional Ownership
85.8% of Sonos shares are held by institutional investors. Comparatively, 99.6% of Installed Building Products shares are held by institutional investors. 1.3% of Sonos shares are held by company insiders. Comparatively, 13.8% of Installed Building Products shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Analyst Recommendations
This is a summary of recent ratings for Sonos and Installed Building Products, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sonos | 0 | 3 | 2 | 0 | 2.40 |
| Installed Building Products | 1 | 10 | 1 | 0 | 2.00 |
Sonos presently has a consensus target price of $20.00, suggesting a potential upside of 25.16%. Installed Building Products has a consensus target price of $249.30, suggesting a potential upside of 5.81%. Given Sonos’ stronger consensus rating and higher probable upside, analysts plainly believe Sonos is more favorable than Installed Building Products.
Summary
Installed Building Products beats Sonos on 9 of the 14 factors compared between the two stocks.
About Sonos
Sonos, Inc., together with its subsidiaries, designs, develops, manufactures, and sells audio products and services in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. It offers wireless, portable, and home theater speakers; components; and accessories. The company offers its products through approximately 10,000 third-party retail stores, including custom installers of home audio systems; and e-commerce retailers, as well as through its website. The company was formerly known as Rincon Audio, Inc. and changed its name to Sonos, Inc. in May 2004. Sonos, Inc. was incorporated in 2002 and is headquartered in Santa Barbara, California.
About Installed Building Products
Installed Building Products, Inc., together with its subsidiaries, engages in the installation of insulation, waterproofing, fire-stopping, fireproofing, garage doors, rain gutters, window blinds, shower doors, closet shelving and mirrors, and other products in the United States. It operates through Installation, Distribution, and Manufacturing operation segments. The company offers a range of insulation materials, such as fiberglass and cellulose, and spray foam insulation materials. It is also involved in the installation of insulation and sealant materials in various areas of a structure, which includes basement and crawl space, building envelope, attic, and acoustical applications. In addition, the company installs a range of caulk and sealant products that control air infiltration in residential and commercial buildings; and waterproofing options, including sheet and hot applied waterproofing membranes, as well as deck coating, bentonite, and air and vapor systems. Further, it distributes spray foam insulation, metal building insulation, residential insulation, and mechanical and fabricated Styrofoam insulation, as well as accessories and equipment used in the insulation installation process; and manufactures cellulose insulation and specialty industrial fibers. It serves homebuilders, multi-family and commercial and agricultural construction firms, individual homeowners, and repair and remodeling contractors. The company was formerly known as CCIB Holdco, Inc. Installed Building Products, Inc. was founded in 1977 and is based in Columbus, Ohio.
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