Chewy (NYSE:CHWY) and Wayfair (NYSE:W) are both large-cap consumer staples companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, valuation, profitability, earnings, risk, institutional ownership and analyst recommendations.
Institutional & Insider Ownership
97.6% of Chewy shares are owned by institutional investors. Comparatively, 81.3% of Wayfair shares are owned by institutional investors. 0.4% of Chewy shares are owned by company insiders. Comparatively, 30.9% of Wayfair shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
Earnings and Valuation
This table compares Chewy and Wayfair's gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
---|
Chewy | $4.85 billion | 8.89 | $-252,370,000.00 | ($0.63) | -165.67 |
Wayfair | $9.13 billion | 3.57 | $-984,580,000.00 | ($10.65) | -30.77 |
Chewy has higher earnings, but lower revenue than Wayfair. Chewy is trading at a lower price-to-earnings ratio than Wayfair, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of current ratings and price targets for Chewy and Wayfair, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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Chewy | 1 | 3 | 14 | 0 | 2.72 |
Wayfair | 4 | 12 | 15 | 0 | 2.35 |
Chewy presently has a consensus price target of $85.00, suggesting a potential downside of 18.56%. Wayfair has a consensus price target of $281.8065, suggesting a potential downside of 15.12%. Given Wayfair's higher possible upside, analysts clearly believe Wayfair is more favorable than Chewy.
Profitability
This table compares Chewy and Wayfair's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
Chewy | -2.70% | N/A | -14.41% |
Wayfair | -5.35% | N/A | -18.55% |
Risk & Volatility
Chewy has a beta of 0.26, suggesting that its stock price is 74% less volatile than the S&P 500. Comparatively, Wayfair has a beta of 3.43, suggesting that its stock price is 243% more volatile than the S&P 500.
Summary
Chewy beats Wayfair on 7 of the 13 factors compared between the two stocks.