Head to Head Survey: Hovnanian Enterprises (NYSE:HOV) and Zepp Health (NYSE:ZEPP)

Zepp Health (NYSE:ZEPP) and Hovnanian Enterprises (NYSE:HOV) are both small-cap consumer discretionary companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, institutional ownership, earnings, risk, analyst recommendations, valuation and dividends.

Volatility and Risk

Zepp Health has a beta of 1.8, suggesting that its share price is 80% more volatile than the S&P 500. Comparatively, Hovnanian Enterprises has a beta of 1.82, suggesting that its share price is 82% more volatile than the S&P 500.

Valuation & Earnings

This table compares Zepp Health and Hovnanian Enterprises”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zepp Health	$276.03 million	0.20	-$40.07 million	($2.75)	-1.37
Hovnanian Enterprises	$2.98 billion	0.21	$63.87 million	$0.95	111.67

Hovnanian Enterprises has higher revenue and earnings than Zepp Health. Zepp Health is trading at a lower price-to-earnings ratio than Hovnanian Enterprises, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of current recommendations and price targets for Zepp Health and Hovnanian Enterprises, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zepp Health	1	0	1	0	2.00
Hovnanian Enterprises	2	2	0	0	1.50

Zepp Health presently has a consensus price target of $53.01, suggesting a potential upside of 1,311.72%. Hovnanian Enterprises has a consensus price target of $74.00, suggesting a potential downside of 30.25%. Given Zepp Health’s stronger consensus rating and higher possible upside, research analysts plainly believe Zepp Health is more favorable than Hovnanian Enterprises.

Profitability

This table compares Zepp Health and Hovnanian Enterprises’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zepp Health	-15.78%	-19.64%	-7.18%
Hovnanian Enterprises	0.64%	8.64%	2.17%

Institutional and Insider Ownership

52.6% of Zepp Health shares are held by institutional investors. Comparatively, 65.4% of Hovnanian Enterprises shares are held by institutional investors. 36.0% of Zepp Health shares are held by company insiders. Comparatively, 22.7% of Hovnanian Enterprises shares are held 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.

Summary

Hovnanian Enterprises beats Zepp Health on 10 of the 14 factors compared between the two stocks.

About Zepp Health

Zepp Health Corporation operates as a smart wearable and health technology company worldwide. The company operates in two segments: Self-Branded Products and Others, and Xiaomi Wearable Products. It empowers users to live lives by optimizing health, fitness, and wellness journeys through its consumer brands, Amazfit, Zepp Clarity, and Zepp Aura. The company through its proprietary Zepp Digital Management Platform, which includes the Zepp OS, AI chips, biometric sensors, and data algorithms, delivers cloud-based 24/7 actionable insights and guidance to help users attain wellness goals. The company offers smart bands, watches, modules, and scales; and associated accessories, smart hearable products, sportswear, home fitness equipment, home appliances, and smart watch accessories. It also provides charts and graphs to display analysis of the activity and biometric data collected from users through its Zepp Life and Zepp mobile apps. It offers its products under the Amazfit and Zepp brand names in approximately 90 countries. The company was formerly known as Huami Corporation and changed its name to Zepp Health Corporation in February 2021. Zepp Health Corporation was founded in 2013 and is headquartered in Hefei, the People's Republic of China.

About Hovnanian Enterprises

Hovnanian Enterprises, Inc., through its subsidiaries, designs, constructs, markets, and sells residential homes in the United States. It offers single-family detached homes, attached townhomes and condominiums, urban infill, and active lifestyle homes with amenities, such as clubhouses, swimming pools, tennis courts, tot lots, and open areas. The company markets and builds homes for first-time buyers, first-time and second-time move-up buyers, luxury buyers, active lifestyle buyers, and empty nesters. It also provides mortgage loans, title insurance, and homeowner’s insurance services. The company was founded in 1959 and is headquartered in Matawan, New Jersey.