Contrasting Installed Building Products (NYSE:IBP) and Legacy Housing (NASDAQ:LEGH)

Legacy Housing (NASDAQ:LEGH) and Installed Building Products (NYSE:IBP) are both consumer discretionary companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, earnings, profitability, institutional ownership, dividends and risk.

Profitability

This table compares Legacy Housing and Installed Building Products’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Legacy Housing	28.56%	9.53%	8.74%
Installed Building Products	8.46%	42.12%	13.20%

Analyst Recommendations

This is a summary of current recommendations and price targets for Legacy Housing and Installed Building Products, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Legacy Housing	0	4	0	0	2.00
Installed Building Products	1	10	2	0	2.08

Legacy Housing presently has a consensus price target of $21.00, indicating a potential downside of 27.79%. Installed Building Products has a consensus price target of $247.55, indicating a potential upside of 25.61%. Given Installed Building Products’ stronger consensus rating and higher probable upside, analysts clearly believe Installed Building Products is more favorable than Legacy Housing.

Institutional & Insider Ownership

89.3% of Legacy Housing shares are owned by institutional investors. Comparatively, 99.6% of Installed Building Products shares are owned by institutional investors. 30.1% of Legacy Housing shares are owned by insiders. Comparatively, 13.8% of Installed Building Products shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Legacy Housing and Installed Building Products”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Legacy Housing	$164.57 million	4.20	$41.81 million	$2.17	13.40
Installed Building Products	$2.97 billion	1.76	$265.40 million	$9.29	21.21

Installed Building Products has higher revenue and earnings than Legacy Housing. Legacy Housing is trading at a lower price-to-earnings ratio than Installed Building Products, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Legacy Housing has a beta of 0.78, suggesting that its share price is 22% less volatile than the S&P 500. Comparatively, Installed Building Products has a beta of 1.71, suggesting that its share price is 71% more volatile than the S&P 500.

Summary

Installed Building Products beats Legacy Housing on 11 of the 14 factors compared between the two stocks.

About Legacy Housing

Legacy Housing Corporation engages in the building, sale, and financing of manufactured homes and tiny houses primarily in the southern United States. It manufactures and provides for the transport of mobile homes, including 1 to 5 bedrooms with 1 to 3 1/2 bathrooms; and provides wholesale financing to dealers and mobile home parks, as well as retail financing to consumers. The company also offers inventory financing for its independent retailers; consumer financing for its products; and financing to manufactured housing community owners that buy or lease its products for use in their rental housing communities. In addition, it involved in financing and developing new manufactured home communities. The company markets its homes under the Legacy brand through a network of independent retailers and company-owned stores; and directly to manufactured home communities. Legacy Housing Corporation was founded in 2005 and is headquartered in Bedford, Texas.

About Installed Building Products

Installed Building Products, Inc., together with its subsidiaries, engages in the installation of insulation, waterproofing, fire-stopping, fireproofing, garage doors, rain gutters, window blinds, shower doors, closet shelving and mirrors, and other products in the United States. It operates through Installation, Distribution, and Manufacturing operation segments. The company offers a range of insulation materials, such as fiberglass and cellulose, and spray foam insulation materials. It is also involved in the installation of insulation and sealant materials in various areas of a structure, which includes basement and crawl space, building envelope, attic, and acoustical applications. In addition, the company installs a range of caulk and sealant products that control air infiltration in residential and commercial buildings; and waterproofing options, including sheet and hot applied waterproofing membranes, as well as deck coating, bentonite, and air and vapor systems. Further, it distributes spray foam insulation, metal building insulation, residential insulation, and mechanical and fabricated Styrofoam insulation, as well as accessories and equipment used in the insulation installation process; and manufactures cellulose insulation and specialty industrial fibers. It serves homebuilders, multi-family and commercial and agricultural construction firms, individual homeowners, and repair and remodeling contractors. The company was formerly known as CCIB Holdco, Inc. Installed Building Products, Inc. was founded in 1977 and is based in Columbus, Ohio.