Critical Contrast: AZEK (NYSE: AZEK) and Deswell Industries (NASDAQ: DSWL)


AZEK (NYSE:AZEK – Get Rating) and Deswell Industries (NASDAQ:DSWL – Get Rating) are both construction companies, but which stock is superior? We will compare the two companies based on the strength of their analyst recommendations, dividends, institutional ownership, profitability, risk, valuation and earnings.

Analyst Notes

This is a breakdown of recent recommendations and price targets for AZEK and Deswell Industries, as provided by MarketBeat.

Sales Ratings Hold odds Buy reviews Strong buy odds Rating
AZEK 0 1 14 0 2.93
Deswell Industries 0 0 0 0 N / A

AZEK currently has a consensus target price of $29.80, indicating a potential upside of 42.86%. Given AZEK’s likely higher upside, research analysts clearly believe that AZEK is more favorable than Deswell Industries.

Volatility and risk

AZEK has a beta of 1.89, suggesting its stock price is 89% more volatile than the S&P 500. In comparison, Deswell Industries has a beta of 0.38, suggesting its stock price is 62% less volatile than the S&P 500.

Profitability

This table compares the net margins, return on equity and return on assets of AZEK and Deswell Industries.

Net margins Return on equity return on assets
AZEK 8.49% 11.08% 7.27%
Deswell Industries N / A N / A N / A

Benefits and evaluation

This table compares the revenue, earnings per share and valuation of AZEK and Deswell Industries.

Gross revenue Price/sales ratio Net revenue Earnings per share Price/earnings ratio
AZEK $1.18 billion 2.74 $93.15 million $0.73 28.58
Deswell Industries $85.49 million 0.59 $8.23 million N / A N / A

AZEK has higher revenues and profits than Deswell Industries.

Institutional and Insider Ownership

96.5% of AZEK shares are held by institutional investors. By comparison, 62.3% of Deswell Industries shares are held by institutional investors. 3.6% of AZEK shares are held by insiders. By comparison, 39.0% of Deswell Industries shares are held by insiders. Strong institutional ownership indicates that large fund managers, endowments, and hedge funds believe a company will outperform the market over the long term.

Summary

AZEK beats Deswell Industries on 10 out of 11 factors compared between the two stocks.

About AZEK

(Get an evaluation)

The AZEK Company Inc. engages in the design, manufacture and sale of building products for the residential, commercial and industrial markets in the United States. It operates through two segments: Residential and Commercial. The Residential segment designs and manufactures engineered exterior products, which include decking, railing, trim and moldings, and accessories under the TimberTech, AZEK Exteriors, VERSATEX and ULTRALOX brands. Its business segment manufactures engineered polymer materials that are used in various industries, including outdoor graphic displays and signage, education and leisure markets, as well as food processing and chemical industries. This segment also offers bathroom partitions, shower and dressing enclosures, lockers and other storage solutions under the Aria, Eclipse, Hiny Hiders, TuffTec and Duralife brands to schools, parks, stadium arenas, industrial facilities and retail, leisure and commercial facilities. The company was formerly known as CPG Newco LLC and changed its name to The AZEK Company Inc. in June 2020. The AZEK Company Inc. was incorporated in 2013 and is headquartered in Chicago, Illinois.

About Deswell Industries

(Get an evaluation)

Deswell Industries, Inc. manufactures and sells injection molded plastic parts and components, electronic products and subassemblies, metal molds and accessory parts for original equipment manufacturers and contract manufacturers. It operates in two segments, plastic injection molding and electronic product assembly. The company produces a range of plastic parts and components used in the manufacture of consumer and industrial products, including plastic components for electronic entertainment products, power tools, accessories and outdoor equipment; cases for flashlights, telephones, printers, scanners; parts for industrial components and interior control switches, as well as parts for audio equipment, and cases and key fobs for personal organizers and remote controls; double injection caps; parts for medical products comprised of blood testing apparatus; laser key caps; automotive components; and automatic robot plastic components. It also provides electronic products consisting of audio equipment, including digital and analog mixing consoles, amplifiers, signal processors, audio interfaces, network audio equipment and speaker enclosures; consumer audio products, such as multi-channel receiver-amplifiers and wired and wireless audio streaming products; printed circuit board assemblies; and IoT products. The Company sells its products mainly in China, the United States, Hong Kong, the United Kingdom, Norway, the Netherlands, Canada and internationally. Deswell Industries, Inc. was founded in 1987 and is based in Macau.



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