Financial Contrast: Sonic Automotive (NYSE:SAH) versus Lazydays (NASDAQ:GORV)

Sonic Automotive (NYSE:SAH) and Lazydays (NASDAQ:GORV) are both small-cap retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, dividends, profitability, valuation, institutional ownership, earnings and analyst recommendations.

Volatility & Risk

Sonic Automotive has a beta of 1.62, suggesting that its share price is 62% more volatile than the S&P 500. Comparatively, Lazydays has a beta of 2.02, suggesting that its share price is 102% more volatile than the S&P 500.

Institutional and Insider Ownership

46.9% of Sonic Automotive shares are owned by institutional investors. Comparatively, 89.7% of Lazydays shares are owned by institutional investors. 41.0% of Sonic Automotive shares are owned by insiders. Comparatively, 61.5% of Lazydays shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Sonic Automotive and Lazydays’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sonic Automotive	1.21%	27.46%	4.64%
Lazydays	-12.48%	-16.47%	-3.86%

Valuation and Earnings

This table compares Sonic Automotive and Lazydays’ gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sonic Automotive	$14.37 billion	0.13	$178.20 million	$4.88	11.56
Lazydays	$1.06 billion	0.05	-$110.27 million	($9.62)	-0.36

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

Analyst Ratings

This is a summary of recent ratings and recommmendations for Sonic Automotive and Lazydays, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sonic Automotive	1	1	2	0	2.25
Lazydays	0	0	0	0	N/A

Sonic Automotive presently has a consensus price target of $57.60, indicating a potential upside of 2.13%. Given Sonic Automotive’s higher probable upside, equities analysts plainly believe Sonic Automotive is more favorable than Lazydays.

Summary

Sonic Automotive beats Lazydays on 10 of the 13 factors compared between the two stocks.

About Sonic Automotive

Sonic Automotive, Inc. operates as an automotive retailer in the United States. It operates in three segments, Franchised Dealerships, EchoPark, and Powersports. The Franchised Dealerships segment is involved in the sale of new and used cars and light trucks, and replacement parts; provision of vehicle maintenance, manufacturer warranty repair, and paint and collision repair services; and arrangement of extended warranties, service contracts, financing, insurance, and other aftermarket products for its guests. The EchoPark segment sells used cars and light trucks; and arranges finance and insurance product sales for its guests in pre-owned vehicle specialty retail locations. The Powersports Segment sells new and used powersports vehicles, such as motorcycles, and personal watercraft and all-terrain vehicles; and offers finance and insurance services. The company was incorporated in 1997 and is based in Charlotte, North Carolina.

About Lazydays

Lazydays Holdings, Inc. operates recreational vehicle (RV) dealerships under the Lazydays name in the United States. The company offers RV sales, RV-repair and services, financing and insurance products, third-party protection plans, and after-market parts and accessories. It also operates the Lazydays RV resort at Tampa, Florida. The company was founded in 1976 and is based in Tampa, Florida.