Reviewing Revolve Group (NYSE:RVLV) and Warby Parker (NYSE:WRBY)

Warby Parker (NYSE:WRBY) and Revolve Group (NYSE:RVLV) are both consumer discretionary companies, but which is the better investment? We will contrast the two companies based on the strength of their earnings, institutional ownership, valuation, profitability, risk, analyst recommendations and dividends.

Analyst Ratings

This is a breakdown of recent recommendations for Warby Parker and Revolve Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Warby Parker	1	3	6	1	2.64
Revolve Group	0	6	7	1	2.64

Warby Parker currently has a consensus price target of $30.00, indicating a potential upside of 21.70%. Revolve Group has a consensus price target of $29.69, indicating a potential upside of 32.61%. Given Revolve Group’s stronger consensus rating and higher possible upside, analysts clearly believe Revolve Group is more favorable than Warby Parker.

Insider & Institutional Ownership

93.2% of Warby Parker shares are held by institutional investors. Comparatively, 67.6% of Revolve Group shares are held by institutional investors. 16.8% of Warby Parker shares are held by company insiders. Comparatively, 42.7% of Revolve Group shares are held by company 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 & Volatility

Warby Parker has a beta of 1.89, meaning that its share price is 89% more volatile than the S&P 500. Comparatively, Revolve Group has a beta of 1.7, meaning that its share price is 70% more volatile than the S&P 500.

Earnings & Valuation

This table compares Warby Parker and Revolve Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Warby Parker	$911.61 million	2.93	$1.64 million	$0.07	352.14
Revolve Group	$1.23 billion	1.30	$61.71 million	$1.01	22.17

Revolve Group has higher revenue and earnings than Warby Parker. Revolve Group is trading at a lower price-to-earnings ratio than Warby Parker, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Warby Parker and Revolve Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Warby Parker	0.85%	3.36%	1.72%
Revolve Group	5.54%	13.38%	8.71%

Summary

Revolve Group beats Warby Parker on 10 of the 14 factors compared between the two stocks.

About Warby Parker

Warby Parker Inc. provides eyewear products in the United States and Canada. The company offers eyeglasses, sunglasses, light-responsive lenses, blue-light-filtering lenses, non-prescription lenses, and contact lenses. It also provides accessories, such as cases, lenses kit with anti-fog spray, pouches, and anti-fog lens spray through its retail stores, website, and mobile apps. In addition, the company offers eye exams and vision tests. Warby Parker Inc. was incorporated in 2009 and is headquartered in New York, New York.

About Revolve Group

Revolve Group, Inc. operates as an online fashion retailer for millennial and generation z consumers in the United States and internationally. The company operates in two segments, REVOLVE and FWRD. It operates a platform that connects consumers and global fashion influencers, as well as emerging, established, and owned brands. The company offers apparel, footwear, accessories, beauty, and home products from emerging, established, and owned brands, as well as luxury brands through its websites and mobile apps. The company was formerly known as Advance Holdings, LLC and changed its name to Revolve Group, Inc. in October 2018. Revolve Group, Inc. was founded in 2003 and is headquartered in Cerritos, California.