Reviewing Argan (NYSE:AGX) and INNOVATE (NYSE:VATE)

Argan (NYSE:AGX) and INNOVATE (NYSE:VATE) are both industrials companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, dividends, institutional ownership, risk, profitability, analyst recommendations and earnings.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Argan	15.09%	38.51%	14.56%
INNOVATE	0.78%	N/A	-1.35%

Insider and Institutional Ownership

79.4% of Argan shares are held by institutional investors. Comparatively, 34.3% of INNOVATE shares are held by institutional investors. 3.0% of Argan shares are held by company insiders. Comparatively, 57.7% of INNOVATE shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility & Risk

Argan has a beta of 0.64, indicating that its stock price is 36% less volatile than the S&P 500. Comparatively, INNOVATE has a beta of 2.57, indicating that its stock price is 157% more volatile than the S&P 500.

Valuation and Earnings

This table compares Argan and INNOVATE”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Argan	$1.19 billion	3.62	$137.77 million	$12.64	24.26
INNOVATE	$1.25 billion	0.05	-$60.60 million	($1.87)	-2.44

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

Analyst Ratings

This is a summary of recent ratings and target prices for Argan and INNOVATE, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Argan	1	4	3	1	2.44
INNOVATE	1	0	0	0	1.00

Argan presently has a consensus price target of $544.00, suggesting a potential upside of 77.44%. Given Argan’s stronger consensus rating and higher possible upside, research analysts plainly believe Argan is more favorable than INNOVATE.

Summary

Argan beats INNOVATE on 12 of the 15 factors compared between the two stocks.

About Argan

Argan, Inc. is a construction and engineering company focused primarily on power generation and related infrastructure. Through its subsidiaries, the company provides services that include engineering, procurement, construction, commissioning, and maintenance. Its Gemma Power Systems subsidiary develops and builds power plants, including natural gas-fired and renewable energy facilities. Atlantic Projects Company provides construction, commissioning, and maintenance services for power generation and industrial facilities, while SMC Infrastructure Solutions serves the electric utility sector with infrastructure construction services.

About INNOVATE

INNOVATE Corp. is a diversified holding company that owns and operates businesses in infrastructure, life sciences and broadcasting. The company was formerly known as HC2 Holdings and adopted the INNOVATE name in 2021. Its infrastructure operations include DBM Global, which provides steel construction, fabrication and related industrial services for projects such as commercial buildings, bridges and industrial facilities. These services are delivered in the United States and select international markets.