Honest (NASDAQ:HNST – Get Free Report) and Beauty Health (NASDAQ:SKIN – Get Free Report) are both small-cap consumer staples companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, valuation, analyst recommendations, dividends, institutional ownership, risk and earnings.
Earnings and Valuation
This table compares Honest and Beauty Health”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Honest | $371.32 million | 1.49 | -$15.69 million | ($0.11) | -45.73 |
| Beauty Health | $300.80 million | 0.28 | -$9.52 million | ($0.22) | -3.00 |
Analyst Ratings
This is a breakdown of recent ratings and price targets for Honest and Beauty Health, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Honest | 2 | 4 | 2 | 1 | 2.22 |
| Beauty Health | 1 | 5 | 1 | 0 | 2.00 |
Honest currently has a consensus target price of $4.84, indicating a potential downside of 3.78%. Beauty Health has a consensus target price of $1.38, indicating a potential upside of 108.33%. Given Beauty Health’s higher probable upside, analysts plainly believe Beauty Health is more favorable than Honest.
Insider and Institutional Ownership
45.5% of Honest shares are held by institutional investors. Comparatively, 93.3% of Beauty Health shares are held by institutional investors. 9.4% of Honest shares are held by company insiders. Comparatively, 40.3% of Beauty Health shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Profitability
This table compares Honest and Beauty Health’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Honest | -3.56% | 4.31% | 3.33% |
| Beauty Health | -9.79% | -47.83% | -5.79% |
Volatility & Risk
Honest has a beta of 2.12, meaning that its share price is 112% more volatile than the S&P 500. Comparatively, Beauty Health has a beta of 1.07, meaning that its share price is 7% more volatile than the S&P 500.
Summary
Honest beats Beauty Health on 10 of the 15 factors compared between the two stocks.
About Honest
The Honest Company, Inc. manufactures and sells diapers and wipes, skin and personal care, and household and wellness products. The company also offers baby clothing and nursery bedding products. It sells its products through digital and retail sales channels, such as its website and third-party ecommerce sites, as well as brick and mortar retailers. The company was incorporated in 2012 and is headquartered in Los Angeles, California.
About Beauty Health
The Beauty Health Company designs, develops, manufactures, markets, and sells aesthetic technologies and products worldwide. The company's flagship product includes HydraFacial that enhance the skin to cleanse, extract, and hydrate the skin with proprietary solutions and serums. Its products also comprise Syndeo, a Delivery System designs to connects providers to the consumer's preferences to create a more personalized experience; consumables, such as single-use tips, solutions, and serums used to provide a hydrafacial treatment; SkinStylus SteriLock Microsystem, a microneedling device used for the treatment of enhancing appearance of surgical or traumatic hypertrophic scars on the abdomen and facial acne scarring in Fitzpatrick skin types I, II, and III; and Keravive, a treatment for scalp health. The company was founded in 1997 and is headquartered in Long Beach, California.
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