Head-To-Head Comparison: Newell Brands (NASDAQ:NWL) & Lennar (NYSE:LEN)

Lennar (NYSE:LEN) and Newell Brands (NASDAQ:NWL) are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, analyst recommendations, dividends, institutional ownership and profitability.

Valuation and Earnings

This table compares Lennar and Newell Brands”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lennar	$31.97 billion	0.60	$2.08 billion	$5.29	15.07
Newell Brands	$7.25 billion	0.33	-$285.00 million	($0.53)	-10.58

Lennar has higher revenue and earnings than Newell Brands. Newell Brands is trading at a lower price-to-earnings ratio than Lennar, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Lennar and Newell Brands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lennar	4.09%	6.13%	3.99%
Newell Brands	-3.05%	12.31%	2.77%

Dividends

Lennar pays an annual dividend of $2.00 per share and has a dividend yield of 2.5%. Newell Brands pays an annual dividend of $0.28 per share and has a dividend yield of 5.0%. Lennar pays out 37.8% of its earnings in the form of a dividend. Newell Brands pays out -52.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Lennar has raised its dividend for 1 consecutive years. Newell Brands is clearly the better dividend stock, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

81.1% of Lennar shares are held by institutional investors. Comparatively, 92.5% of Newell Brands shares are held by institutional investors. 10.1% of Lennar shares are held by company insiders. Comparatively, 1.6% of Newell Brands shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Volatility & Risk

Lennar has a beta of 1.39, indicating that its stock price is 39% more volatile than the S&P 500. Comparatively, Newell Brands has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for Lennar and Newell Brands, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lennar	10	8	1	0	1.53
Newell Brands	2	5	3	0	2.10

Lennar presently has a consensus price target of $91.00, suggesting a potential upside of 14.14%. Newell Brands has a consensus price target of $6.66, suggesting a potential upside of 18.65%. Given Newell Brands’ stronger consensus rating and higher possible upside, analysts clearly believe Newell Brands is more favorable than Lennar.

Summary

Lennar beats Newell Brands on 10 of the 17 factors compared between the two stocks.

About Lennar

Lennar Corporation, together with its subsidiaries, operates as a homebuilder primarily under the Lennar brand in the United States. It operates through Homebuilding East, Homebuilding Central, Homebuilding Texas, Homebuilding West, Financial Services, Multifamily, and Lennar Other segments. The company’s 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; and development, construction, and management of multifamily rental properties. It also offers residential mortgage financing, title, insurance, and closing services for home buyers and others, as well as originates and sells securitization commercial mortgage loans. In addition, the company is involved in the fund investment activity. It primarily serves first-time, move-up, active adult, and luxury homebuyers. Lennar Corporation was founded in 1954 and is based in Miami, Florida.

About Newell Brands

Newell Brands Inc. engages in the design, manufacture, sourcing, and distribution of consumer and commercial products worldwide. The company operates in three segments: Home and Commercial Solutions, Learning and Development, and Outdoor and Recreation. The Commercial Solutions segment provides commercial cleaning and maintenance solution products under the Rubbermaid, Rubbermaid Commercial Products, Mapa, and Spontex brands; closet and garage organization products; hygiene systems and material handling solutions; household products, such as kitchen appliances under the Crockpot, Mr. Coffee, Oster, and Sunbeam brands; small appliances under the Breville brand name in Europe; food and home storage products under the FoodSaver, Rubbermaid, Ball, and Sistema brands; fresh preserving products; vacuum sealing products; and gourmet cookware, bakeware, and cutlery under the Calphalon brand; and home fragrance products under the WoodWick and Yankee Candle brands. The Learning and Development segment offers writing instruments, including markers and highlighters, pens, and pencils; art products; activity-based products; labeling solutions; and baby gear and infant care products under the Dymo, Elmer's, EXPO, Graco, NUK, Paper Mate, Parker, and Sharpie brands. The Outdoor and Recreation segment provides outdoor and outdoor-related products, inlcuding technical apparel and on-the-go beverageware under the Campingaz, Coleman, Contigo, and Marmot brands. It serves warehouse clubs, department and drug/grocery stores, mass merchants, home centers, commercial products distributors, specialty retailers, office superstores and supply stores, contract stationers, e-commerce retailers, and sporting goods, as well as direct to consumers online, select contract customers, and other professional customers. Newell Brands Inc. was founded in 1903 and is based in Atlanta, Georgia.