LGI Homes (NASDAQ:LGIH – Get Free Report) and Somnigroup International (NYSE:SGI – Get Free Report) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, analyst recommendations, dividends, institutional ownership, earnings, valuation and profitability.
Analyst Recommendations
This is a breakdown of current recommendations for LGI Homes and Somnigroup International, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| LGI Homes | 2 | 2 | 2 | 0 | 2.00 |
| Somnigroup International | 1 | 2 | 7 | 0 | 2.60 |
LGI Homes presently has a consensus price target of $72.75, suggesting a potential upside of 32.27%. Somnigroup International has a consensus price target of $96.12, suggesting a potential upside of 37.79%. Given Somnigroup International’s stronger consensus rating and higher probable upside, analysts plainly believe Somnigroup International is more favorable than LGI Homes.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| LGI Homes | 3.88% | 3.55% | 1.88% |
| Somnigroup International | 7.00% | 19.32% | 5.22% |
Earnings and Valuation
This table compares LGI Homes and Somnigroup International”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| LGI Homes | $1.71 billion | 0.75 | $72.55 million | $2.85 | 19.30 |
| Somnigroup International | $7.48 billion | 1.96 | $384.10 million | $2.50 | 27.90 |
Somnigroup International has higher revenue and earnings than LGI Homes. LGI Homes is trading at a lower price-to-earnings ratio than Somnigroup International, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
LGI Homes has a beta of 1.84, indicating that its share price is 84% more volatile than the S&P 500. Comparatively, Somnigroup International has a beta of 1.19, indicating that its share price is 19% more volatile than the S&P 500.
Institutional and Insider Ownership
84.9% of LGI Homes shares are owned by institutional investors. Comparatively, 99.9% of Somnigroup International shares are owned by institutional investors. 12.6% of LGI Homes shares are owned by company insiders. Comparatively, 4.0% of Somnigroup International shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Summary
Somnigroup International beats LGI Homes on 11 of the 14 factors compared between the two stocks.
About LGI Homes
LGI Homes, Inc. designs, constructs, and sells homes. It offers entry-level homes, such as attached and detached homes, and active adult homes under the LGI Homes brand name; and luxury series homes under the Terrata Homes brand name. The company also engages in the wholesale business, which include building and selling homes to large institutions looking to acquire single-family rental properties. It serves customers in Texas, Arizona, Florida, Georgia, New Mexico, Colorado, North Carolina, South Carolina, Washington, Tennessee, Minnesota, Oklahoma, Alabama, California, Oregon, Nevada, West Virginia, Virginia, Pennsylvania, Maryland, and Utah. LGI Homes, Inc. was founded in 2003 and is headquartered in The Woodlands, Texas.
About Somnigroup International
Somnigroup International Inc., together with its subsidiaries, designs, manufactures, distributes, and retails bedding products in the United States and internationally. It provides mattresses, foundations and adjustable foundations, and adjustable bases, as well as other products comprising pillows, mattress covers, sheets, cushions, and various other accessories and comfort products under the Tempur-Pedic, Sealy, Stearns & Foster, Sealy, and Cocoon by Sealy brand names. The company sells its products through approximately company-owned stores, online, and call centers; and third party retailers, including third party distribution, hospitality, and healthcare. It also operates a portfolio of retail brands, including Tempur-Pedic retail stores, Sleep Outfitters, Sleep Solutions Outlet, Dreams, and SOVA; and licenses Sealy, Tempur, and Stearns & Foster brands, as well as technology and trademarks to other manufacturers. The company was formerly known as Tempur Sealy International, Inc. and changed its name to Somnigroup International Inc. in February 2025. Somnigroup International Inc. was founded in 1846 and is based in Lexington, Kentucky.
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