Fortune Brands Home & Security (FBHS) versus Lennar (LEN.B) Head to Head Analysis

Fortune Brands Home & Security (NYSE: FBHS) and Lennar (NYSE:LEN.B) are both industrial products companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, valuation, dividends and analyst recommendations.

Earnings & Valuation

This table compares Fortune Brands Home & Security and Lennar’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Fortune Brands Home & Security $5.28 billion 1.57 $472.60 million $3.08 18.50
Lennar $12.65 billion 1.06 $810.48 million N/A N/A

Lennar has higher revenue and earnings than Fortune Brands Home & Security.

Profitability

This table compares Fortune Brands Home & Security and Lennar’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Fortune Brands Home & Security 8.79% 19.01% 8.84%
Lennar 6.84% 11.65% 5.26%

Analyst Ratings

This is a breakdown of recent ratings and price targets for Fortune Brands Home & Security and Lennar, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Fortune Brands Home & Security 0 6 8 0 2.57
Lennar 0 0 0 0 N/A

Fortune Brands Home & Security currently has a consensus target price of $69.50, indicating a potential upside of 21.95%. Given Fortune Brands Home & Security’s higher probable upside, equities research analysts clearly believe Fortune Brands Home & Security is more favorable than Lennar.

Volatility and Risk

Fortune Brands Home & Security has a beta of 1.41, meaning that its stock price is 41% more volatile than the S&P 500. Comparatively, Lennar has a beta of 1.24, meaning that its stock price is 24% more volatile than the S&P 500.

Insider and Institutional Ownership

91.4% of Fortune Brands Home & Security shares are held by institutional investors. Comparatively, 3.6% of Lennar shares are held by institutional investors. 1.7% of Fortune Brands Home & Security shares are held by company insiders. Comparatively, 15.0% of Lennar shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Dividends

Fortune Brands Home & Security pays an annual dividend of $0.80 per share and has a dividend yield of 1.4%. Lennar pays an annual dividend of $0.16 per share and has a dividend yield of 0.4%. Fortune Brands Home & Security pays out 26.0% of its earnings in the form of a dividend. Fortune Brands Home & Security has raised its dividend for 4 consecutive years. Fortune Brands Home & Security is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Fortune Brands Home & Security beats Lennar on 11 of the 15 factors compared between the two stocks.

About Fortune Brands Home & Security

Fortune Brands Home & Security, Inc., together with its subsidiaries, provides home and security products for residential home repair, remodeling, new construction, and security applications. It operates in four segments: Cabinets, Plumbing, Doors, and Security. The Cabinets segment manufactures custom, semi-custom, and stock cabinetry, as well as vanities for the kitchen, bath, and other parts of the home directly to kitchen and bath dealers, home centers, wholesalers, and builders in North America. The Plumbing segment manufactures, assembles, and sells faucets, accessories, kitchen sinks, and waste disposals in the United States, Canada China, Mexico, Southeast Asia, Europe, and South America directly through its own sales force, as well as through independent manufacturers' representatives primarily to wholesalers, home centers, mass merchandisers, and industrial distributors. The Doors segment manufactures and sells fiberglass and steel entry doors to home centers, millwork building products and wholesale distributors, and specialty dealers, as well as to the remodeling and renovation markets in the United States and Canada. The Security segment manufactures and sells key-controlled and combination padlocks, bicycle and cable locks, built-in locker locks, door hardware, automotive locks, trailer and towing locks, electronic access control solutions, and other specialty safety and security devices for consumer use to hardware, home center, and other retail outlets. It also offers lock systems and fire resistant safes to locksmiths, industrial and institutional users, and original equipment manufacturers. This segment sells its products in the United States, Canada, Europe, Central America, Japan, and Australia. The company was founded in 1988 and is headquartered in Deerfield, Illinois.

About Lennar

Lennar Corporation is a provider of real estate related financial services, commercial real estate, investment management and finance company. The Company is a homebuilder that operates in various states. Its segments include Homebuilding East, Homebuilding Central, Homebuilding West, Lennar Financial Services, Rialto and Lennar Multifamily. It is a developer of multifamily rental properties. Its Homebuilding operations include the construction and sale of single-family attached and detached homes, as well as the purchase, development and sale of residential land. It operates primarily under the Lennar brand name. The Lennar Financial Services segment includes mortgage financing, title insurance and closing services for both buyers of its homes and others. The Rialto segment is a real estate, investment management, and finance company. The Lennar Multifamily segment focuses on developing a portfolio of institutional multifamily rental properties in the United States markets.

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