Primoris Services (NASDAQ: PRIM) and Fluor Co. (NEW) (NYSE:FLR) are both construction companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, profitability, risk, earnings and valuation.
Primoris Services pays an annual dividend of $0.24 per share and has a dividend yield of 0.9%. Fluor Co. (NEW) pays an annual dividend of $0.84 per share and has a dividend yield of 1.5%. Primoris Services pays out 17.0% of its earnings in the form of a dividend. Fluor Co. (NEW) pays out 61.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.
Earnings & Valuation
This table compares Primoris Services and Fluor Co. (NEW)’s top-line revenue, earnings per share and valuation.
||Earnings Per Share
|Fluor Co. (NEW)
Fluor Co. (NEW) has higher revenue and earnings than Primoris Services. Primoris Services is trading at a lower price-to-earnings ratio than Fluor Co. (NEW), indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
Primoris Services has a beta of 1.28, indicating that its stock price is 28% more volatile than the S&P 500. Comparatively, Fluor Co. (NEW) has a beta of 1.52, indicating that its stock price is 52% more volatile than the S&P 500.
This table compares Primoris Services and Fluor Co. (NEW)’s net margins, return on equity and return on assets.
||Return on Equity
||Return on Assets
|Fluor Co. (NEW)
This is a summary of recent ratings for Primoris Services and Fluor Co. (NEW), as provided by MarketBeat.com.
||Strong Buy Ratings
|Fluor Co. (NEW)
Primoris Services presently has a consensus target price of $30.00, suggesting a potential upside of 11.69%. Fluor Co. (NEW) has a consensus target price of $58.33, suggesting a potential upside of 1.20%. Given Primoris Services’ stronger consensus rating and higher possible upside, analysts clearly believe Primoris Services is more favorable than Fluor Co. (NEW).
Institutional & Insider Ownership
71.8% of Primoris Services shares are held by institutional investors. Comparatively, 87.1% of Fluor Co. (NEW) shares are held by institutional investors. 24.0% of Primoris Services shares are held by insiders. Comparatively, 1.4% of Fluor Co. (NEW) shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Primoris Services beats Fluor Co. (NEW) on 9 of the 16 factors compared between the two stocks.
About Primoris Services
Primoris Services Corporation is a holding company. The Company holds various subsidiaries, through which it operates as a specialty contractor and infrastructure company. The Company provides a range of construction, fabrication, maintenance, replacement, water and wastewater, and engineering services to public utilities, petrochemical companies, energy companies, municipalities, state departments of transportation and other customers. It operates in three segments: the West Construction Services segment (West segment), the East Construction Services segment (East segment) and the Energy segment. The Company installs, replaces, repairs and rehabilitates natural gas, refined product, water and wastewater pipeline systems; large diameter gas and liquid pipeline facilities, and heavy civil projects, earthwork and site development.
About Fluor Co. (NEW)
Fluor Corporation (Fluor) is a holding company. The Company operates its business in four segments: Energy, Chemicals & Mining; Industrial, Infrastructure & Power; Government, and Maintenance, Modification & Asset Integrity (MMAI). The Company, through its subsidiaries, offers professional services providing engineering, procurement, construction, fabrication and modularization, commissioning and maintenance, as well as project management services on a global basis. The Company is an integrated solutions provider for various industries, including oil and gas, chemicals and petrochemicals, mining and metals, transportation, power, life sciences and advanced manufacturing. It is also a service provider to the United States federal Government and governments abroad. It offers services in various categories, including engineering and design, procurement, construction, fabrication, maintenance, modification and asset integrity and project management.
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