RH (NYSE:RH – Get Free Report) and BJ’s Wholesale Club (NYSE:BJ – Get Free Report) are both consumer staples companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, analyst recommendations, dividends, earnings, profitability, risk and institutional ownership.
Insider and Institutional Ownership
90.2% of RH shares are held by institutional investors. Comparatively, 98.6% of BJ’s Wholesale Club shares are held by institutional investors. 26.9% of RH shares are held by insiders. Comparatively, 1.1% of BJ’s Wholesale Club shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Valuation & Earnings
This table compares RH and BJ’s Wholesale Club”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| RH | $3.44 billion | 0.68 | $124.79 million | $6.31 | 19.50 |
| BJ’s Wholesale Club | $21.46 billion | 0.57 | $578.38 million | $4.38 | 21.99 |
BJ’s Wholesale Club has higher revenue and earnings than RH. RH is trading at a lower price-to-earnings ratio than BJ’s Wholesale Club, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a breakdown of current ratings and recommmendations for RH and BJ’s Wholesale Club, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| RH | 5 | 8 | 7 | 0 | 2.10 |
| BJ’s Wholesale Club | 1 | 9 | 9 | 0 | 2.42 |
RH currently has a consensus target price of $175.13, indicating a potential upside of 42.30%. BJ’s Wholesale Club has a consensus target price of $107.38, indicating a potential upside of 11.48%. Given RH’s higher probable upside, equities analysts plainly believe RH is more favorable than BJ’s Wholesale Club.
Volatility & Risk
RH has a beta of 1.89, suggesting that its share price is 89% more volatile than the S&P 500. Comparatively, BJ’s Wholesale Club has a beta of 0.27, suggesting that its share price is 73% less volatile than the S&P 500.
Profitability
This table compares RH and BJ’s Wholesale Club’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| RH | 3.63% | -567.82% | 2.62% |
| BJ’s Wholesale Club | 2.70% | 27.55% | 7.90% |
Summary
BJ’s Wholesale Club beats RH on 8 of the 14 factors compared between the two stocks.
About RH
RH, together with its subsidiaries, operates as a retailer in the home furnishings market. The company offers products in various categories, including furniture, lighting, textiles, bathware, décor, outdoor and garden, baby, child, and teen furnishings. It provides its products through rh.com, rhbabyandchild.com, rhteen.com, rhmodern.com, and waterworks.com online channels, as well as operates RH Galleries, RH outlet stores, RH Guesthouse, and Waterworks showrooms in the United States, Canada, the United Kingdom, and Germany. The company was formerly known as Restoration Hardware Holdings, Inc. and changed its name to RH in January 2017. RH was incorporated in 2011 and is headquartered in Corte Madera, California.
About BJ’s Wholesale Club
BJ’s Wholesale Club Holdings, Inc. engages in the operation of membership warehouse clubs. Its product categories include grocery, household and pet, television and electronics, furniture, computer and tablets, patio and outdoor living, lawn and garden, baby and kids, toys, home, health and beauty, appliances, and jewelry. The company was founded in 1984 and is headquartered in Marlborough, MA.
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