Analyzing Beazer Homes USA (BZH) and AV Homes (AVHI)

Beazer Homes USA (NYSE: BZH) and AV Homes (NASDAQ:AVHI) are both small-cap construction companies, but which is the superior stock? We will contrast the two companies based on the strength of their profitability, earnings, valuation, institutional ownership, analyst recommendations, dividends and risk.

Valuation and Earnings

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This table compares Beazer Homes USA and AV Homes’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Beazer Homes USA $1.92 billion 0.26 $31.81 million $1.54 9.57
AV Homes $843.25 million 0.50 -$21.93 million $0.74 25.34

Beazer Homes USA has higher revenue and earnings than AV Homes. Beazer Homes USA is trading at a lower price-to-earnings ratio than AV Homes, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Beazer Homes USA and AV Homes’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Beazer Homes USA -5.01% 7.99% 2.32%
AV Homes -2.60% 2.77% 1.22%

Risk & Volatility

Beazer Homes USA has a beta of 2.53, suggesting that its share price is 153% more volatile than the S&P 500. Comparatively, AV Homes has a beta of 0.49, suggesting that its share price is 51% less volatile than the S&P 500.

Institutional & Insider Ownership

89.3% of Beazer Homes USA shares are owned by institutional investors. Comparatively, 85.5% of AV Homes shares are owned by institutional investors. 7.3% of Beazer Homes USA shares are owned by company insiders. Comparatively, 6.8% of AV Homes shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings for Beazer Homes USA and AV Homes, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Beazer Homes USA 0 3 2 0 2.40
AV Homes 0 1 0 0 2.00

Beazer Homes USA presently has a consensus price target of $21.33, suggesting a potential upside of 44.73%. Given Beazer Homes USA’s stronger consensus rating and higher probable upside, equities analysts plainly believe Beazer Homes USA is more favorable than AV Homes.

Summary

Beazer Homes USA beats AV Homes on 11 of the 14 factors compared between the two stocks.

Beazer Homes USA Company Profile

Beazer Homes USA, Inc. operates as a homebuilder in the United States. The company designs, constructs, and sells single-family and multi-family homes for entry-level, move-up, or retirement-oriented home buyers under the Beazer Homes brand name. It sells its homes through commissioned new home sales counselors and independent brokers in Arizona, California, Nevada, Texas, Delaware, Indiana, Maryland, Tennessee, Virginia, Florida, Georgia, North Carolina, and South Carolina. Beazer Homes USA, Inc. was founded in 1985 and is headquartered in Atlanta, Georgia.

AV Homes Company Profile

AV Homes, Inc. engages in the homebuilding and community development businesses in Florida, the Carolinas, Arizona, and Texas markets. The company is involved in the acquisition, development, and building of active adult communities, which are age-restricted to the age 55 and over active adult demographic; and primary residential home communities under local Savvy Homes, Bonterra Builders, Royal Oak Homes, and Oakdale-Hampton brands for first-time and move-up buyers. It also engages in the construction and sale of residences within the communities. In addition, the company is involved in other real estate activities, such as the operation of amenities; and the sale of land for third-party development. As of December 31, 2017, it owned 4,911 developed residential lots; 2,395 partially developed residential lots; 8,776 undeveloped residential lots; and 6,980 acres of mixed-use, commercial, and industrial land. The company was formerly known as Avatar Holdings Inc. and changed its name to AV Homes, Inc. in February 2012. AV Homes, Inc. was founded in 1970 and is headquartered in Scottsdale, Arizona.

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