Critical Contrast: Purple Innovation (NASDAQ:PRPL) and Green Brick Partners (NASDAQ:GRBK)

Purple Innovation (NASDAQ:PRPL) and Green Brick Partners (NASDAQ:GRBK) are both consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, valuation, institutional ownership, risk, profitability, dividends and analyst recommendations.

Institutional & Insider Ownership

88.4% of Purple Innovation shares are held by institutional investors. Comparatively, 78.2% of Green Brick Partners shares are held by institutional investors. 54.0% of Purple Innovation shares are held by company insiders. Comparatively, 30.3% of Green Brick Partners shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings for Purple Innovation and Green Brick Partners, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Purple Innovation	1	2	0	0	1.67
Green Brick Partners	0	2	0	0	2.00

Purple Innovation currently has a consensus price target of $16.25, suggesting a potential upside of 302.23%. Given Purple Innovation’s higher probable upside, equities analysts clearly believe Purple Innovation is more favorable than Green Brick Partners.

Profitability

This table compares Purple Innovation and Green Brick Partners’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Purple Innovation	-10.74%	N/A	-10.89%
Green Brick Partners	17.70%	25.35%	17.29%

Volatility and Risk

Purple Innovation has a beta of 1.46, meaning that its share price is 46% more volatile than the S&P 500. Comparatively, Green Brick Partners has a beta of 1.79, meaning that its share price is 79% more volatile than the S&P 500.

Valuation and Earnings

This table compares Purple Innovation and Green Brick Partners”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Purple Innovation	$468.73 million	0.04	-$51.41 million	($11.24)	-0.36
Green Brick Partners	$2.03 billion	1.54	$284.63 million	$6.64	10.90

Green Brick Partners has higher revenue and earnings than Purple Innovation. Purple Innovation is trading at a lower price-to-earnings ratio than Green Brick Partners, indicating that it is currently the more affordable of the two stocks.

Summary

Green Brick Partners beats Purple Innovation on 10 of the 13 factors compared between the two stocks.

About Purple Innovation

Purple Innovation, Inc. designs and manufactures sleep and other products in the United States and internationally. The company offers mattresses, pillows, cushions, bases, sheets, platforms, adjustable bases, mattress protectors, foundations, blankets, duvets, duvet covers, seat cushions, and pet beds under the Purple brand. It markets and sells its products through its e-commerce online channels, retail brick-and-mortar wholesale partners, third-party online retailers, and Purple showrooms, as well as through its website, Purple.com. The company was founded in 2010 and is headquartered in Lehi, Utah.

About Green Brick Partners

Green Brick Partners, Inc. is a diversified homebuilding and land development company in the United States. The company operates through three segments: Builder operations Central, Builder operations Southeast, and Land Development. The Builder operations Central segment operates builders in Texas; and the closing and delivery of homes. The Builder operations Southeast operates builders in Georgia and Florida. The Land Development segment acquires land for the development of residential lots that are transferred to our controlled builders or sold to third party homebuilders. It also provides financial services platform, including mortgage and title services. In addition, the company is engaged in all aspects of the homebuilding process, including land acquisition and development, entitlements, design, construction, marketing, and sales for its residential neighborhoods and master-planned communities. Green Brick Partners, Inc. was incorporated in 2006 and is based in Plano, Texas.