Advanced Drainage Systems (NYSE: WMS) and UFP Technologies (NASDAQ:UFPT) are both small-cap construction companies, but which is the superior investment? We will compare the two companies based on the strength of their valuation, dividends, institutional ownership, profitability, earnings, analyst recommendations and risk.
Volatility and Risk
Advanced Drainage Systems has a beta of 0.88, meaning that its share price is 12% less volatile than the S&P 500. Comparatively, UFP Technologies has a beta of 0.11, meaning that its share price is 89% less volatile than the S&P 500.
This table compares Advanced Drainage Systems and UFP Technologies’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Advanced Drainage Systems||3.67%||45.42%||3.58%|
This is a summary of recent recommendations for Advanced Drainage Systems and UFP Technologies, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Advanced Drainage Systems||0||4||1||0||2.20|
Advanced Drainage Systems presently has a consensus price target of $26.25, indicating a potential upside of 1.94%. Given Advanced Drainage Systems’ higher probable upside, equities analysts plainly believe Advanced Drainage Systems is more favorable than UFP Technologies.
Valuation & Earnings
This table compares Advanced Drainage Systems and UFP Technologies’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Advanced Drainage Systems||$1.26 billion||1.15||$32.95 million||$0.50||51.50|
|UFP Technologies||$147.84 million||1.58||$9.21 million||$1.25||25.52|
Advanced Drainage Systems has higher revenue and earnings than UFP Technologies. UFP Technologies is trading at a lower price-to-earnings ratio than Advanced Drainage Systems, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
79.5% of Advanced Drainage Systems shares are held by institutional investors. Comparatively, 69.2% of UFP Technologies shares are held by institutional investors. 21.4% of Advanced Drainage Systems shares are held by insiders. Comparatively, 13.3% of UFP Technologies shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Advanced Drainage Systems pays an annual dividend of $0.28 per share and has a dividend yield of 1.1%. UFP Technologies does not pay a dividend. Advanced Drainage Systems pays out 56.0% of its earnings in the form of a dividend. Advanced Drainage Systems has raised its dividend for 2 consecutive years.
Advanced Drainage Systems beats UFP Technologies on 11 of the 16 factors compared between the two stocks.
Advanced Drainage Systems Company Profile
Advanced Drainage Systems, Inc. designs, manufactures, and markets thermoplastic corrugated pipes and related water management products for non-residential, residential, agriculture, and infrastructure applications in the United States and internationally. The company provides single, double, and triple wall corrugated polypropylene and polyethylene pipes; and allied products comprising storm retention/detention and septic chambers, polyvinyl chloride drainage structures, fittings, and water quality filters and separators. It also purchases and distributes construction fabrics, as well as other geosynthetic products for soil stabilization, reinforcement, filtration, separation, erosion control, and sub-surface drainage. The company was founded in 1966 and is headquartered in Hilliard, Ohio.
UFP Technologies Company Profile
UFP Technologies, Inc. designs and converts foams, plastics, composites, and natural fiber materials for the medical, automotive, consumer, electronics, industrial, and aerospace and defense markets in the United States. The company offers medical devices and components, disposable wound care components, automotive interior trims, athletic paddings, abrasive nail files and other beauty aids, air filtration products, high-temperature insulations, military uniform and gear components, and cushion packaging products. It also provides wine shipping solutions made from molded fiber under the Wine Packs name; tube and pipe insulations for clean room environments under the T-Tubes name; pharmaceutical bag protection systems under the BioShell name; sanitary solutions for nail care services under the Pro-Sticks name; medical device pouches for protecting small instruments and tools under the FlexShield name; and multi-purpose cleaning erasers under the Erasables name, as well as various products under the Spot Eraser, Tri-Covers, Design Nail, and Mambo names. In addition, the company designs, manufactures, and markets a range of packaging solutions primarily using polyethylene, polyurethane, cross-linked polyethylene foams, and rigid plastics to original equipment and component manufacturers. The company markets and sells its products through d direct sales forces and independent manufacturer representatives. UFP Technologies, Inc. was founded in 1963 and is headquartered in Newburyport, Massachusetts.
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