Analyzing Construction Partners (NASDAQ:ROAD) and IES (NASDAQ:IESC)

Construction Partners (NASDAQ:ROAD) and IES (NASDAQ:IESC) are both industrials companies, but which is the better investment? We will compare the two companies based on the strength of their dividends, risk, institutional ownership, analyst recommendations, earnings, valuation and profitability.

Risk & Volatility

Construction Partners has a beta of 0.93, meaning that its stock price is 7% less volatile than the S&P 500. Comparatively, IES has a beta of 1.77, meaning that its stock price is 77% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Construction Partners and IES, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Construction Partners	0	4	3	1	2.62
IES	0	1	2	0	2.67

Construction Partners currently has a consensus price target of $133.50, suggesting a potential upside of 46.57%. IES has a consensus price target of $334.50, suggesting a potential downside of 1.43%. Given Construction Partners’ higher possible upside, equities research analysts plainly believe Construction Partners is more favorable than IES.

Earnings & Valuation

This table compares Construction Partners and IES”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Construction Partners	$3.48 billion	1.49	$101.78 million	$2.55	35.72
IES	$3.99 billion	3.39	$303.06 million	$11.26	30.14

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

Insider and Institutional Ownership

94.8% of Construction Partners shares are owned by institutional investors. Comparatively, 86.6% of IES shares are owned by institutional investors. 15.7% of Construction Partners shares are owned by insiders. Comparatively, 56.4% of IES shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Construction Partners and IES’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Construction Partners	4.10%	16.06%	4.59%
IES	11.40%	35.70%	19.68%

Summary

IES beats Construction Partners on 10 of the 15 factors compared between the two stocks.

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.

About IES

IES Holdings, Inc. engages in the design and installation of integrated electrical and technology systems, and provides infrastructure products and services in the United States. The Communications segment designs, installs, and maintains network infrastructure within data centers for co-location and managed hosting customers; corporate, educational, financial, hospitality, and healthcare buildings; e-commerce distribution centers; and high-tech manufacturing facilities. This segment also provides design and installation services for audio/visual, telephone, fire, and wireless access and intrusion alarm systems; and engages in designing/building, servicing, and maintaining data network systems. The Residential segment offers electrical installations to single-family housing and multi-family apartments; and cable television installations to residential and light commercial applications, as well as installs residential solar power for new construction and existing residences. The Infrastructure Solutions segment maintains and repairs alternating and direct current electric motors and generators, and power generating and distribution equipment; manufactures custom-engineered metal enclosed bus duct solutions used in power distribution; manufactures custom commercial and industrial generator enclosures; manufactures, re-manufactures, and repairs industrial lifting magnets; and maintains and repairs railroad main and auxiliary generators, main alternators, and traction motors. The Commercial & Industrial segment offers electrical and mechanical design, construction, and maintenance services for office buildings, manufacturing facilities, data centers, chemical plants, refineries, wind farms, solar facilities, municipal infrastructures, and health care facilities. The company was formerly known as Integrated Electrical Services, Inc. and changed its name to IES Holdings, Inc. in May 2016. IES Holdings, Inc. was incorporated in 1997 and is headquartered in Houston, Texas.