Quanex Building Products (NYSE:NX) and Lihua International (OTCMKTS:LIWA) are both small-cap construction companies, but which is the better business? We will compare the two companies based on the strength of their valuation, risk, earnings, dividends, institutional ownership, profitability and analyst recommendations.

Analyst Ratings

This is a summary of current ratings and price targets for Quanex Building Products and Lihua International, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Quanex Building Products 0 1 1 0 2.50
Lihua International 0 0 0 0 N/A

Quanex Building Products presently has a consensus price target of $15.00, indicating a potential downside of 5.06%. Given Quanex Building Products’ higher probable upside, analysts clearly believe Quanex Building Products is more favorable than Lihua International.

Dividends

Quanex Building Products pays an annual dividend of $0.32 per share and has a dividend yield of 2.0%. Lihua International does not pay a dividend. Quanex Building Products pays out 49.2% of its earnings in the form of a dividend.

Institutional & Insider Ownership

98.8% of Quanex Building Products shares are owned by institutional investors. 5.6% of Quanex Building Products shares are owned by company insiders. Comparatively, 44.9% of Lihua International shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Quanex Building Products and Lihua International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Quanex Building Products 2.96% 5.40% 2.96%
Lihua International N/A N/A N/A

Earnings & Valuation

This table compares Quanex Building Products and Lihua International’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Quanex Building Products $889.78 million 0.59 $26.32 million $0.65 24.31
Lihua International N/A N/A N/A N/A N/A

Quanex Building Products has higher revenue and earnings than Lihua International.

Volatility and Risk

Quanex Building Products has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500. Comparatively, Lihua International has a beta of 0.54, meaning that its share price is 46% less volatile than the S&P 500.

Summary

Quanex Building Products beats Lihua International on 9 of the 11 factors compared between the two stocks.

About Quanex Building Products

Quanex Building Products Corporation, together with its subsidiaries, provides components for the fenestration industry worldwide. It operates through three segments: North American Engineered Components, European Engineered Components, and North American Cabinet Components. The company offers flexible insulating glass spacers, extruded vinyl profiles, window and door screens, and precision-formed metal and wood products, as well as cabinet doors and other components for original equipment manufacturers (OEMs) in the kitchen and bathroom cabinet industry. It also provides various non-fenestration components and products, including solar panel sealants, trim moldings, vinyl decking, fencing, water retention barriers, and conservatory roof components. The company sells its products to OEMs in the building products industry through sales representatives, direct sales force, distributors, and independent sales agents. Quanex Building Products Corporation was founded in 1927 and is headquartered in Houston, Texas.

About Lihua International

Lihua International, Inc., through its subsidiaries, produces copper replacement in the People's Republic of China. It designs, develops, manufactures, markets, and distributes refined copper products, including copper anode, copper rod, fine and superfine pure copper wire, and copper-clad aluminum (CCA) fine and superfine wires. Its copper rod based wire products comprise cable products used for telephone drop wires and conductors; electric utilities; transmission lines, grid wires, fences, and structured grounds; industrial drop wires, magnet wires, battery cables, and automotive wiring harnesses; and radio frequency shielding, as well as magnet wire products used in electronic motors, transformers, water pumps, automobile meters, energy, industrial, commercial, and residential industries. The company produces and distributes copper and CCA wire products in various forms, including fine wires to smaller wire manufacturers for further processing; magnet wires used for electrical conductivity in a range of motorized appliances; and tin plated wires for the transmission of audio and visual signals. Lihua International, Inc. manufactures and sells copper anode to copper entities, which produce and sell copper cathode to copper products manufacturers. The company sells its products directly to manufacturers or through distributors in the wire and cable industries, as well as through manufacturers in the consumer electronics, audio and visual equipment, white goods, automotive, utility, telecommunications, and specialty cable industries. The company was founded in 1999 and is headquartered in Danyang, the People's Republic of China.

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