Head-To-Head Survey: PulteGroup (NYSE:PHM) versus Mohawk Industries (NYSE:MHK)

Mohawk Industries (NYSE:MHK) and PulteGroup (NYSE:PHM) are both consumer discretionary companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, analyst recommendations, earnings and risk.

Institutional and Insider Ownership

79.0% of Mohawk Industries shares are owned by institutional investors. Comparatively, 89.9% of PulteGroup shares are owned by institutional investors. 17.9% of Mohawk Industries shares are owned by insiders. Comparatively, 0.7% of PulteGroup shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Mohawk Industries and PulteGroup”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Mohawk Industries	$10.79 billion	0.85	$369.90 million	$7.55	17.91
PulteGroup	$17.31 billion	1.39	$2.22 billion	$9.79	13.14

PulteGroup has higher revenue and earnings than Mohawk Industries. PulteGroup is trading at a lower price-to-earnings ratio than Mohawk Industries, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Mohawk Industries and PulteGroup, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Mohawk Industries	0	12	3	1	2.31
PulteGroup	0	7	10	0	2.59

Mohawk Industries currently has a consensus target price of $130.50, suggesting a potential downside of 3.48%. PulteGroup has a consensus target price of $143.14, suggesting a potential upside of 11.26%. Given PulteGroup’s stronger consensus rating and higher probable upside, analysts plainly believe PulteGroup is more favorable than Mohawk Industries.

Risk & Volatility

Mohawk Industries has a beta of 1.18, meaning that its stock price is 18% more volatile than the S&P 500. Comparatively, PulteGroup has a beta of 1.19, meaning that its stock price is 19% more volatile than the S&P 500.

Profitability

This table compares Mohawk Industries and PulteGroup’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Mohawk Industries	4.15%	7.50%	4.60%
PulteGroup	11.62%	15.21%	10.89%

Summary

PulteGroup beats Mohawk Industries on 12 of the 15 factors compared between the two stocks.

About Mohawk Industries

Mohawk Industries, Inc. designs, manufactures, sources, distributes, and markets flooring products for residential and commercial remodeling, and new construction channels in the United States, Europe, Latin America, and internationally. It operates through three segments: Global Ceramic, Flooring North America, and Flooring Rest of the World. The company provides ceramic, porcelain, and natural stone tiles products for floor and wall applications; natural stones, porcelain slabs, and quartz countertops, as well as installation materials; floor covering products comprising broadloom carpets, carpet tiles, rugs and mats, carpet pads, laminates, medium-density fiberboards, wood floorings, luxury vinyl tiles, and sheet vinyl; and roofing panels, insulation boards, mezzanine flooring products, medium-density fiberboard, and chipboards. It also licenses its intellectual property to flooring manufacturers. The company sells its products under the American Olean, Daltile, Decortiles, Eliane, EmilGroup, KAI, Kerama Marazzi, Marazzi, Ragno, Aladdin Commercial, Durkan, Foss, IVC, Karastan, Mohawk, Mohawk Group, Mohawk Home, Pergo, Portico, Quick-Step, Feltex, GH Commercial, Godfrey Hirst, Hycraft, IVC Commercial, IVC Home, Lentex, Leoline, and Moduleo, Redbook, Unilin, and Vitromex brands. It offers its products to company-owned service centers and stores, company-operated distributors, floor covering retailers, wholesalers, mass merchandisers, department stores, shop at home, buying groups, ceramic tile specialists, e-commerce retailers, residential builders, independent distributors, commercial contractors, and commercial end users. The company was incorporated in 1988 and is headquartered in Calhoun, Georgia.

About PulteGroup

PulteGroup, Inc., through its subsidiaries, primarily engages in the homebuilding business in the United States. It acquires and develops land primarily for residential purposes; and constructs housing on such land. The company also offers various home designs, including single-family detached, townhomes, condominiums, and duplexes under the Centex, Pulte Homes, Del Webb, DiVosta Homes, John Wieland Homes and Neighborhoods, and American West brand names. In addition, the company arranges financing through the origination of mortgage loans primarily for homebuyers; sells the servicing rights for the originated loans; and provides title insurance policies, and examination and closing services to homebuyers. PulteGroup, Inc. was founded in 1950 and is headquartered in Atlanta, Georgia.