Contrasting Builders FirstSource (BLDR) and Jewett-Cameron Trading (JCTCF)

Jewett-Cameron Trading (NASDAQ:JCTCF) and Builders FirstSource (NASDAQ:BLDR) are both small-cap retail/wholesale companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, valuation, analyst recommendations, profitability, dividends, earnings and risk.

Profitability

This table compares Jewett-Cameron Trading and Builders FirstSource’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Jewett-Cameron Trading 5.82% 14.97% 13.41%
Builders FirstSource 1.44% 48.32% 6.80%

Risk and Volatility

Jewett-Cameron Trading has a beta of 0.48, suggesting that its share price is 52% less volatile than the S&P 500. Comparatively, Builders FirstSource has a beta of 1.99, suggesting that its share price is 99% more volatile than the S&P 500.

Institutional and Insider Ownership

21.0% of Jewett-Cameron Trading shares are held by institutional investors. Comparatively, 93.6% of Builders FirstSource shares are held by institutional investors. 43.9% of Jewett-Cameron Trading shares are held by company insiders. Comparatively, 2.3% of Builders FirstSource shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Jewett-Cameron Trading and Builders FirstSource, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Jewett-Cameron Trading 0 0 0 0 N/A
Builders FirstSource 1 4 6 0 2.45

Builders FirstSource has a consensus target price of $18.70, indicating a potential upside of 49.66%. Given Builders FirstSource’s higher probable upside, analysts clearly believe Builders FirstSource is more favorable than Jewett-Cameron Trading.

Earnings and Valuation

This table compares Jewett-Cameron Trading and Builders FirstSource’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Jewett-Cameron Trading $53.92 million 0.57 $2.92 million N/A N/A
Builders FirstSource $7.03 billion 0.20 $38.78 million $1.27 9.84

Builders FirstSource has higher revenue and earnings than Jewett-Cameron Trading.

Summary

Builders FirstSource beats Jewett-Cameron Trading on 7 of the 12 factors compared between the two stocks.

About Jewett-Cameron Trading

Jewett-Cameron Trading Company Ltd., through its subsidiaries, manufactures and distributes specialty metal products; and distributes wood products to home centers and other retailers primarily in the United States. The company operates through four segments: Industrial Wood Products; Lawn, Garden, Pet and Other; Seed Processing and Sales; and Industrial Tools and Clamps. The Industrial Wood Products segment processes and distributes industrial wood products. It offers treated plywood to boat manufacturers and the transportation industry. The Lawn, Garden, Pet and Other segment is involved in the wholesale of wood products, such as fencing and landscape timbers; and manufacture and distribution of specialty metal products comprising dog kennels, proprietary gate support systems, perimeter fencing, and greenhouses. The Seed Processing and Sales segment processes and distributes agricultural seeds to distributors. This segment is also involved in cleaning seeds. The Industrial Tools and Clamps segment imports and distributes pneumatic air tools, industrial clamps, saw blades, digital calipers, and laser guides to retailers under the MSI-Pro, Avenger, and ProMax brands. The company was founded in 1953 and is based in North Plains, Oregon.

About Builders FirstSource

Builders FirstSource, Inc. manufactures and supplies building materials, manufactured components, and construction services to professional homebuilders, sub-contractors, remodelers, and consumers in the United States. The company operates through four segments: Northeast, Southeast, South, and West. Its products include lumber and lumber sheet goods comprising dimensional lumber, plywood, and OSB products that are used in on-site house framing; and windows, and interior and exterior door units, as well as interior trims and custom products under the Synboard brand. The company's manufactured products consist of wood floor and roof trusses, steel roof trusses, wall panels, stairs, and engineered wood; gypsum, roofing, and insulation products, including wallboards, ceilings, joint treatments, and finishes, as well as vinyl, composite, and wood sidings; and exterior trims, other exteriors, metal studs, and cement products. In addition, it offers other building products and services, such as cabinets and hardware, as well as turn-key framing, shell construction, design assistance, and professional installation services. Further, the company supplies professional grade building products, such as lumber and lumber sheet goods, and various windows, doors, and millwork lines. The company was formerly known as BSL Holdings, Inc. and changed its name to Builders FirstSource, Inc. in October 1999. Builders FirstSource, Inc. was founded in 1998 and is based in Dallas, Texas.

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