UFP Industries (NASDAQ:UFPI – Get Free Report) and Watts Water Technologies (NYSE:WTS – Get Free Report) are both industrials companies, but which is the superior stock? We will compare the two companies based on the strength of their profitability, risk, valuation, dividends, analyst recommendations, earnings and institutional ownership.
Insider & Institutional Ownership
81.8% of UFP Industries shares are owned by institutional investors. Comparatively, 95.0% of Watts Water Technologies shares are owned by institutional investors. 2.5% of UFP Industries shares are owned by company insiders. Comparatively, 1.0% of Watts Water Technologies shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.
Valuation & Earnings
This table compares UFP Industries and Watts Water Technologies”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| UFP Industries | $6.32 billion | 0.70 | $294.79 million | $4.36 | 18.45 |
| Watts Water Technologies | $2.68 billion | 4.38 | $340.80 million | $11.45 | 30.68 |
Watts Water Technologies has lower revenue, but higher earnings than UFP Industries. UFP Industries is trading at a lower price-to-earnings ratio than Watts Water Technologies, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares UFP Industries and Watts Water Technologies’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| UFP Industries | 3.99% | 8.00% | 6.11% |
| Watts Water Technologies | 14.34% | 19.16% | 13.78% |
Risk & Volatility
UFP Industries has a beta of 1.22, meaning that its stock price is 22% more volatile than the S&P 500. Comparatively, Watts Water Technologies has a beta of 1.13, meaning that its stock price is 13% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current recommendations and price targets for UFP Industries and Watts Water Technologies, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| UFP Industries | 0 | 3 | 3 | 0 | 2.50 |
| Watts Water Technologies | 0 | 6 | 4 | 1 | 2.55 |
UFP Industries presently has a consensus price target of $104.50, suggesting a potential upside of 29.93%. Watts Water Technologies has a consensus price target of $367.70, suggesting a potential upside of 4.67%. Given UFP Industries’ higher possible upside, equities research analysts plainly believe UFP Industries is more favorable than Watts Water Technologies.
Dividends
UFP Industries pays an annual dividend of $1.44 per share and has a dividend yield of 1.8%. Watts Water Technologies pays an annual dividend of $2.52 per share and has a dividend yield of 0.7%. UFP Industries pays out 33.0% of its earnings in the form of a dividend. Watts Water Technologies pays out 22.0% 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. UFP Industries has increased its dividend for 5 consecutive years and Watts Water Technologies has increased its dividend for 13 consecutive years.
Summary
Watts Water Technologies beats UFP Industries on 13 of the 18 factors compared between the two stocks.
About UFP Industries
UFP Industries, Inc., through its subsidiaries, designs, manufactures, and markets wood and non-wood composites, and other materials in North America, Europe, Asia, and Australia. It operates through Retail, Packaging, and Construction segments. The Retail segment offers treated lumber products, including decking, fencing, lattice, and other products; pressure-treated and fire-retardant products used primarily for outdoor decking environments; and lawn and garden products, consisting of wood and vinyl fencing options, garden beds and planters, pergolas, picnic tables, and other landscaping products. This segment also offers wood plastic composites, composite decking, and related decking accessories, including non- aluminum railing systems, balusters, post caps, and other products, as well as pre-painted and primed shiplap and project boards. The Packaging segment provides custom and structural packaging products, pallets, corrugate, foam, labels, strapping, and films. The construction segment offers roof trusses, cut-to-size dimensional and board lumber, plywoods, and oriented strand boards; engineered wood components, including roof and floor trusses, wall panels, I-joists, and lumber packages; and alternate materials components, such as metal trusses, sheathed and pre-finished light gauge metal wall panels, aluminum decks, and rail accessories, as well as distributes siding, electrical, and plumbing products. This segment also engages in the manufacture of components; design, manufacture, and supply of wood forms and related products to set or form concrete for structures, such as parking garages, stadiums, and other infrastructure projects. It also offers interior fixtures, millwork, and casework for retail and commercial structures. The company was formerly known as Universal Forest Products, Inc. and changed its name to UFP Industries, Inc. in April 2020. UFP Industries, Inc. was incorporated in 1955 and is headquartered in Grand Rapids, Michigan.
About Watts Water Technologies
Watts Water Technologies, Inc., together with its subsidiaries, supplies products and solutions that manage and conserve the flow of fluids and energy into, through, and out of buildings in the commercial, industrial, and residential markets in the Americas, Europe, the Asia-Pacific, the Middle East, and Africa. The company offers residential and commercial flow control and protection products, including backflow preventers, water pressure regulators, temperature and pressure relief valves, thermostatic mixing valves, leak detection and protection products, commercial washroom solutions, and emergency safety products and equipment for plumbing and hot water applications. It also provides heating, ventilation, and air conditioning and gas products comprising commercial boilers; water heaters and heating solutions; hydronic and electric heating systems for under-floor radiant applications; custom heat and hot water solutions; hydronic pump groups for boiler manufacturers and alternative energy control packages; and flexible stainless-steel connectors for natural and liquid propane gas in commercial food service and residential applications. In addition, the company offers drainage and water re-use products, such as drainage products, engineered rainwater harvesting solutions for commercial, industrial, marine, and residential applications; connected roof drain systems; and water quality products that include point-of-use and point-of-entry water filtration, conditioning, and scale prevention systems for commercial, marine, and residential applications. The company sells its products to plumbing, heating, and mechanical wholesale distributors and dealers; original equipment manufacturers; specialty product distributors; and do-it-yourself and retail chains, as well as wholesalers and private label accounts. Watts Water Technologies, Inc. was founded in 1874 and is headquartered in North Andover, Massachusetts.
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