Reviewing Grafton Group (OTCMKTS:GROUF) & Construction Partners (NASDAQ:ROAD)

Grafton Group (OTCMKTS:GROUF) and Construction Partners (NASDAQ:ROAD) are both mid-cap construction companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, risk, valuation, earnings and analyst recommendations.

Valuation & Earnings

This table compares Grafton Group and Construction Partners”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Grafton Group	$2.92 billion	0.74	$155.92 million	N/A	N/A
Construction Partners	$2.45 billion	2.55	$68.93 million	$1.37	81.36

Grafton Group has higher revenue and earnings than Construction Partners.

Profitability

This table compares Grafton Group and Construction Partners’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Grafton Group	N/A	N/A	N/A
Construction Partners	3.04%	12.24%	3.81%

Insider and Institutional Ownership

8.2% of Grafton Group shares are owned by institutional investors. Comparatively, 94.8% of Construction Partners shares are owned by institutional investors. 16.4% of Construction Partners shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Grafton Group has a beta of 0.28, indicating that its share price is 72% less volatile than the S&P 500. Comparatively, Construction Partners has a beta of 1, indicating that its share price has a similar volatility profile to the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and target prices for Grafton Group and Construction Partners, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Grafton Group	0	0	1	0	3.00
Construction Partners	0	1	1	2	3.25

Construction Partners has a consensus target price of $112.3333, suggesting a potential upside of 0.78%. Given Construction Partners’ stronger consensus rating and higher possible upside, analysts plainly believe Construction Partners is more favorable than Grafton Group.

Summary

Construction Partners beats Grafton Group on 10 of the 12 factors compared between the two stocks.

About Grafton Group

Grafton Group plc engages in the distribution, retailing, and manufacturing businesses in Ireland, the Netherlands, Finland, and the United Kingdom. Its Distribution segment distributes building materials, paint, tools, ironmongery, fixings, and accessories, workwear and PPE, and spare parts; materials and plant for mechanical services, heating, plumbing, and air movement; and trade, DIY, and self-build markets with building materials, timber, doors and floors, plumbing and heating, bathrooms, and landscaping products under the Selco, Leyland SDM, Chadwicks, MacBlair, Isero, Polvo, Gunters en Meuser, TG Lynes, and IKH brands. The company’s Retailing segment retails home and garden products through stores, including DIY products, paints, lighting products, homestyle products, housewares, bathroom products, and kitchens, as well as gardening and Christmas products under the Woodie’s brand. Its Manufacturing segment manufactures dry mortars and wooden staircases; and drainage, ducting and roofline systems under the CPI Mortar, StairBox, and MFP brand names. Grafton Group plc was founded in 1902 and is based in Dublin, Ireland.

About Construction Partners

Construction Partners, Inc., a civil infrastructure company, constructs and maintains roadways in Alabama, Florida, Georgia, North Carolina, South Carolina, and Tennessee. The company provides various products and services to public and private infrastructure projects, such as highways, roads, bridges, airports, and commercial and residential developments. It also engages in manufacturing and distributing hot mix asphalt (HMA) for internal use and sales to third parties in connection with construction projects; and paving activities, including the construction of roadway base layers and application of asphalt pavement. In addition, the company is involved in site development, including the installation of utility and drainage systems; mining aggregates, such as sand, gravel, and construction stones that are used as raw materials in the production of HMA; and distributing liquid asphalt cement for internal use and sales to third parties in connection with HMA production. The company was formerly known as SunTx CPI Growth Company, Inc. and changed its name to Construction Partners, Inc. in September 2017. Construction Partners, Inc. was founded in 2007 and is headquartered in Dothan, Alabama.