Critical Comparison: Smith Douglas Homes (SDHC) & Its Rivals

Smith Douglas Homes (NYSE:SDHC) is one of 26 public companies in the “Operative builders” industry, but how does it contrast to its peers? We will compare Smith Douglas Homes to similar businesses based on the strength of its risk, analyst recommendations, dividends, earnings, valuation, profitability and institutional ownership.

Profitability

This table compares Smith Douglas Homes and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Smith Douglas Homes	4.60%	21.01%	16.10%
Smith Douglas Homes Competitors	9.23%	84.38%	10.92%

Valuation & Earnings

This table compares Smith Douglas Homes and its peers top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Smith Douglas Homes	$975.46 million	$123.18 million	10.45
Smith Douglas Homes Competitors	$6.34 billion	$777.96 million	7.09

Smith Douglas Homes’ peers have higher revenue and earnings than Smith Douglas Homes. Smith Douglas Homes is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Insider and Institutional Ownership

89.0% of shares of all “Operative builders” companies are held by institutional investors. 18.7% of shares of all “Operative builders” companies are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Volatility and Risk

Smith Douglas Homes has a beta of 1.31, meaning that its stock price is 31% more volatile than the S&P 500. Comparatively, Smith Douglas Homes’ peers have a beta of 2.56, meaning that their average stock price is 156% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Smith Douglas Homes and its peers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Smith Douglas Homes	1	4	0	0	1.80
Smith Douglas Homes Competitors	400	1882	1734	53	2.35

Smith Douglas Homes presently has a consensus price target of $24.60, suggesting a potential upside of 33.70%. As a group, “Operative builders” companies have a potential upside of 32.26%. Given Smith Douglas Homes’ higher probable upside, equities research analysts plainly believe Smith Douglas Homes is more favorable than its peers.

Summary

Smith Douglas Homes peers beat Smith Douglas Homes on 10 of the 13 factors compared.

Smith Douglas Homes Company Profile

Smith Douglas Homes Corp., together with its subsidiaries, engages in the design, construction, and sale of single-family homes in the southeastern United States. It also provides closing, escrow, and title insurance services. The company sells its products to entry-level and empty-nest homebuyers. Smith Douglas Homes Corp. was founded in 2008 and is headquartered in Woodstock, Georgia.