Financial Analysis: Armstrong World Industries (AWI) and Its Competitors

Armstrong World Industries (NYSE:AWI) is one of 93 publicly-traded companies in the “Building Products” industry, but how does it contrast to its rivals? We will compare Armstrong World Industries to related businesses based on the strength of its institutional ownership, risk, profitability, dividends, earnings, analyst recommendations and valuation.

Analyst Ratings

This is a breakdown of current ratings and price targets for Armstrong World Industries and its rivals, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Armstrong World Industries	0	2	7	0	2.78
Armstrong World Industries Competitors	733	3906	5037	237	2.48

Armstrong World Industries presently has a consensus target price of $203.12, suggesting a potential upside of 22.29%. As a group, “Building Products” companies have a potential upside of 27.17%. Given Armstrong World Industries’ rivals higher possible upside, analysts plainly believe Armstrong World Industries has less favorable growth aspects than its rivals.

Earnings & Valuation

This table compares Armstrong World Industries and its rivals top-line revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Armstrong World Industries	$1.75 billion	$308.70 million	22.18
Armstrong World Industries Competitors	$4.01 billion	$4.66 billion	36.93

Armstrong World Industries’ rivals have higher revenue and earnings than Armstrong World Industries. Armstrong World Industries is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Institutional and Insider Ownership

98.9% of Armstrong World Industries shares are held by institutional investors. Comparatively, 63.6% of shares of all “Building Products” companies are held by institutional investors. 1.2% of Armstrong World Industries shares are held by insiders. Comparatively, 10.2% of shares of all “Building Products” companies are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Armstrong World Industries and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Armstrong World Industries	18.38%	38.06%	17.16%
Armstrong World Industries Competitors	3.72%	-28.21%	5.11%

Volatility and Risk

Armstrong World Industries has a beta of 1.16, indicating that its stock price is 16% more volatile than the S&P 500. Comparatively, Armstrong World Industries’ rivals have a beta of 1.07, indicating that their average stock price is 7% more volatile than the S&P 500.

Dividends

Armstrong World Industries pays an annual dividend of $1.49 per share and has a dividend yield of 0.9%. Armstrong World Industries pays out 19.9% of its earnings in the form of a dividend. As a group, “Building Products” companies pay a dividend yield of 7.1% and pay out 37.7% of their earnings in the form of a dividend. Armstrong World Industries has increased its dividend for 1 consecutive years.

Summary

Armstrong World Industries beats its rivals on 8 of the 15 factors compared.

Armstrong World Industries Company Profile

Armstrong World Industries, Inc., together with its subsidiaries, engages in the design, manufacture, and sale of ceiling and wall solutions in the Americas. It operates through Mineral Fiber and Architectural Specialties segments. The company offers mineral fiber, fiberglass wool, metal, wood, felt, wood fiber, and glass-reinforced-gypsum; ceiling component products, such as ceiling perimeters and trims, as well as grid products that support drywall ceiling systems; ceilings, walls, and facades for use in commercial settings; and manufactures ceiling suspension system (grid) products. It serves commercial and residential construction markets, as well as renovation of existing buildings sectors. The company sells its products to resale distributors, ceiling system contractors, wholesalers, and retailers comprising large home centers. Armstrong World Industries, Inc. was founded in 1860 and is headquartered in Lancaster, Pennsylvania.