Simpson Manufacturing (NYSE:SSD) vs. Owens Corning (NYSE:OC) Head-To-Head Review

Owens Corning (NYSE:OC) and Simpson Manufacturing (NYSE:SSD) are both construction companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, risk, earnings, dividends, valuation, profitability and analyst recommendations.

Volatility and Risk

Owens Corning has a beta of 1.32, meaning that its share price is 32% more volatile than the S&P 500. Comparatively, Simpson Manufacturing has a beta of 1.28, meaning that its share price is 28% more volatile than the S&P 500.

Valuation & Earnings

This table compares Owens Corning and Simpson Manufacturing”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Owens Corning	$10.98 billion	0.95	$647.00 million	$3.85	32.39
Simpson Manufacturing	$2.23 billion	3.26	$322.22 million	$8.21	21.29

Owens Corning has higher revenue and earnings than Simpson Manufacturing. Simpson Manufacturing is trading at a lower price-to-earnings ratio than Owens Corning, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Owens Corning and Simpson Manufacturing, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Owens Corning	1	7	10	0	2.50
Simpson Manufacturing	0	2	1	0	2.33

Owens Corning presently has a consensus target price of $178.31, suggesting a potential upside of 42.97%. Simpson Manufacturing has a consensus target price of $201.00, suggesting a potential upside of 15.02%. Given Owens Corning’s stronger consensus rating and higher possible upside, equities analysts clearly believe Owens Corning is more favorable than Simpson Manufacturing.

Dividends

Owens Corning pays an annual dividend of $2.76 per share and has a dividend yield of 2.2%. Simpson Manufacturing pays an annual dividend of $1.16 per share and has a dividend yield of 0.7%. Owens Corning pays out 71.7% of its earnings in the form of a dividend. Simpson Manufacturing pays out 14.1% 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. Owens Corning has raised its dividend for 10 consecutive years and Simpson Manufacturing has raised its dividend for 11 consecutive years.

Insider & Institutional Ownership

88.4% of Owens Corning shares are held by institutional investors. Comparatively, 93.7% of Simpson Manufacturing shares are held by institutional investors. 0.8% of Owens Corning shares are held by insiders. Comparatively, 0.4% of Simpson Manufacturing shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Owens Corning and Simpson Manufacturing’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Owens Corning	2.98%	24.49%	8.85%
Simpson Manufacturing	14.90%	18.11%	11.90%

Summary

Owens Corning beats Simpson Manufacturing on 10 of the 17 factors compared between the two stocks.

About Owens Corning

Owens Corning manufactures and sells building and construction materials in the United States, Europe, the Asia Pacific, and internationally. It operates in three segments: Roofing, Insulation, and Composites. The Roofing segment manufactures and sells laminate and strip asphalt roofing shingles, oxidized asphalt materials, and roofing components used in residential and commercial construction, and specialty applications. This segment sells its products through distributors, home centers, and lumberyards, as well as to roofing contractors for built-up roofing asphalt systems; and manufacturers in automotive, chemical, rubber, and construction industries. The Insulation segment manufactures and sells thermal and acoustical batts, loosefill insulation, spray foam insulation, foam sheathing and accessories under the Owens Corning PINK, and FIBERGLAS brands; and glass fiber pipe insulation, energy efficient flexible duct media, bonded and granulated mineral wool insulation, cellular glass insulation, and foam insulation under the FOAMULAR, FOAMGLAS, and Paroc brand names used in construction applications. This segment sells its products primarily to the insulation installers, home centers, lumberyards, retailers, and distributors. The Composites segment manufactures, fabricates, and sells glass reinforcements in the form of fiber; and glass fiber products in the form of fabrics, non-wovens, and composite lumber. Its products are used in building structures, roofing shingles, tubs and showers, pools, decking, flooring, pipes and tanks, poles, electrical equipment, and wind-energy turbine blades. This segment sells its products directly to parts molders, fabricators, and shingle manufacturers. The company was incorporated in 1938 and is headquartered in Toledo, Ohio.

About Simpson Manufacturing

Simpson Manufacturing Co., Inc., through its subsidiaries, designs, engineers, manufactures, and sells structural solutions for wood, concrete, and steel connections. The company offers wood construction products, including connectors, truss plates, fastening systems, fasteners and shearwalls, and pre-fabricated lateral systems for use in light-frame construction; and concrete construction products comprising adhesives, specialty chemicals, mechanical anchors, carbide drill bits, powder actuated tools, fiber-reinforced materials, and other repair products for use in concrete, masonry, and steel construction, as well as grouts, coatings, sealers, mortars, fiberglass and fiber-reinforced polymer systems, and asphalt products for use in concrete construction repair, and strengthening and protection products. It also provides connectors and lateral products for wood framing, timber and offsite construction, structural steel construction, and cold-formed steel applications; and mechanical and adhesive anchors for concrete and masonry construction applications. In addition, the company offers engineering and design services, as well as software solutions that facilitate the specification, selection, and use of its products. It markets its products to the residential construction, light industrial and commercial construction, infrastructure construction, remodeling, and do-it-yourself markets in the United States, Canada, France, the United Kingdom, Germany, Denmark, Switzerland, Portugal, Poland, the Netherlands, Belgium, Spain, Italy, Romania, Sweden, Norway, Australia, New Zealand, China, Taiwan, and Vietnam. The company was founded in 1956 and is headquartered in Pleasanton, California.