Comparing Chewy (NYSE:CHWY) & O’Reilly Automotive (NASDAQ:ORLY)

O’Reilly Automotive (NASDAQ:ORLY) and Chewy (NYSE:CHWY) are both consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, profitability, valuation, institutional ownership, dividends, risk and analyst recommendations.

Profitability

This table compares O’Reilly Automotive and Chewy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
O’Reilly Automotive	14.27%	-232.45%	15.79%
Chewy	1.99%	60.02%	8.17%

Earnings & Valuation

This table compares O’Reilly Automotive and Chewy”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
O’Reilly Automotive	$17.78 billion	3.91	$2.54 billion	$3.14	27.35
Chewy	$12.60 billion	0.75	$222.80 million	$0.60	38.67

O’Reilly Automotive has higher revenue and earnings than Chewy. O’Reilly Automotive is trading at a lower price-to-earnings ratio than Chewy, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

85.0% of O’Reilly Automotive shares are owned by institutional investors. Comparatively, 93.1% of Chewy shares are owned by institutional investors. 0.8% of O’Reilly Automotive shares are owned by insiders. Comparatively, 0.3% of Chewy shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Risk and Volatility

O’Reilly Automotive has a beta of 0.52, suggesting that its share price is 48% less volatile than the S&P 500. Comparatively, Chewy has a beta of 1.42, suggesting that its share price is 42% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for O’Reilly Automotive and Chewy, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
O’Reilly Automotive	0	3	14	1	2.89
Chewy	0	7	18	1	2.77

O’Reilly Automotive presently has a consensus price target of $107.24, suggesting a potential upside of 24.85%. Chewy has a consensus price target of $31.27, suggesting a potential upside of 34.80%. Given Chewy’s higher probable upside, analysts plainly believe Chewy is more favorable than O’Reilly Automotive.

Summary

O’Reilly Automotive beats Chewy on 8 of the 14 factors compared between the two stocks.

About O’Reilly Automotive

O’Reilly Automotive, Inc., together with its subsidiaries, operates as a retailer and supplier of automotive aftermarket parts, tools, supplies, equipment, and accessories in the United States, Puerto Rico, and Mexico. The company provides new and remanufactured automotive hard parts and maintenance items, such as alternators, batteries, brake system components, belts, chassis parts, driveline parts, engine parts, fuel pumps, hoses, starters, temperature control, water pumps, antifreeze, appearance products, engine additives, filters, fluids, lighting products, and oil and wiper blades; and accessories, including floor mats, seat covers, and truck accessories. It also offers auto body paint and related materials, automotive tools, and professional service provider service equipment. In addition, the company provide enhanced services and programs comprising used oil, oil filter, and battery recycling; battery, wiper, and bulb replacement; battery diagnostic testing; electrical and module testing; check engine light code extraction; loaner tool program; drum and rotor resurfacing; custom hydraulic hoses; and professional paint shop mixing and related materials. Further, it offers do-it-yourself and professional service for domestic and imported automobiles, vans, and trucks. The company was founded in 1957 and is headquartered in Springfield, Missouri.

About Chewy

Chewy, Inc., together with its subsidiaries, engages in the pure play e-commerce business in the United States. It provides pet food and treats, pet supplies and pet medications, and other pet-health products, as well as pet services for dogs, cats, fish, birds, small pets, horses, and reptiles through its retail websites and mobile applications. The company was founded in 2010 and is based in Plantation, Florida.