United Homes Group (NASDAQ:UHG) vs. Smith Douglas Homes (NYSE:SDHC) Financial Analysis

United Homes Group (NASDAQ:UHG) and Smith Douglas Homes (NYSE:SDHC) are both small-cap finance companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, dividends, valuation, risk, profitability, earnings and analyst recommendations.

Profitability

This table compares United Homes Group and Smith Douglas Homes’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
United Homes Group	82.93%	-295.76%	32.12%
Smith Douglas Homes	N/A	N/A	N/A

Analyst Recommendations

This is a breakdown of current ratings for United Homes Group and Smith Douglas Homes, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
United Homes Group	0	0	0	0	N/A
Smith Douglas Homes	0	5	1	0	2.17

Smith Douglas Homes has a consensus target price of $27.10, indicating a potential upside of 18.86%. Given Smith Douglas Homes’ higher probable upside, analysts plainly believe Smith Douglas Homes is more favorable than United Homes Group.

Institutional and Insider Ownership

88.9% of United Homes Group shares are owned by institutional investors. 85.3% of United Homes Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares United Homes Group and Smith Douglas Homes’ top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
United Homes Group	$421.47 million	0.66	$125.06 million	$5.68	1.02
Smith Douglas Homes	$764.63 million	1.53	$123.18 million	N/A	N/A

United Homes Group has higher earnings, but lower revenue than Smith Douglas Homes.

About United Homes Group

United Homes Group, Inc., a homebuilding company, engages in the design, building, and sale of homes in South Carolina, North Carolina, and Georgia. It provides detached single-family houses, as well as attached single-family houses, including duplex and town houses for entry-level buyers, first time move-ups, second time move-ups, third time move-ups, and custom builds. The company was founded in 2004 and is headquartered in Chapin, South Carolina.

About Smith Douglas Homes

Smith Douglas Homes Corp., together with its subsidiaries, engages in the design, construction, and sale of single-family homes in the southeastern United States. It also provides closing, escrow, and title insurance services. The company sells its products to entry-level and empty-nest homebuyers. Smith Douglas Homes Corp. was founded in 2008 and is headquartered in Woodstock, Georgia.