Analyzing Newell Brands (NASDAQ:NWL) and Purple Innovation (NASDAQ:PRPL)

Newell Brands (NASDAQ:NWL) and Purple Innovation (NASDAQ:PRPL) are both small-cap consumer staples companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, risk, institutional ownership, profitability, analyst recommendations, valuation and dividends.

Institutional & Insider Ownership

92.5% of Newell Brands shares are held by institutional investors. Comparatively, 88.4% of Purple Innovation shares are held by institutional investors. 1.6% of Newell Brands shares are held by company insiders. Comparatively, 53.9% of Purple Innovation 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.

Analyst Recommendations

This is a summary of current recommendations and price targets for Newell Brands and Purple Innovation, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Newell Brands	2	5	3	0	2.10
Purple Innovation	1	2	0	0	1.67

Newell Brands currently has a consensus price target of $4.94, indicating a potential upside of 35.84%. Purple Innovation has a consensus price target of $0.65, indicating a potential upside of 61.73%. Given Purple Innovation’s higher probable upside, analysts plainly believe Purple Innovation is more favorable than Newell Brands.

Valuation & Earnings

This table compares Newell Brands and Purple Innovation”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Newell Brands	$7.19 billion	0.22	-$285.00 million	($0.67)	-5.43
Purple Innovation	$468.73 million	0.09	-$51.41 million	($0.58)	-0.69

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

Profitability

This table compares Newell Brands and Purple Innovation’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Newell Brands	-3.91%	8.89%	2.03%
Purple Innovation	-13.65%	N/A	-12.25%

Volatility and Risk

Newell Brands has a beta of 1.06, meaning that its stock price is 6% more volatile than the S&P 500. Comparatively, Purple Innovation has a beta of 1.52, meaning that its stock price is 52% more volatile than the S&P 500.

Summary

Newell Brands beats Purple Innovation on 8 of the 14 factors compared between the two stocks.

About Newell Brands

Newell Brands Inc. engages in the design, manufacture, sourcing, and distribution of consumer and commercial products worldwide. The company operates in three segments: Home and Commercial Solutions, Learning and Development, and Outdoor and Recreation. The Commercial Solutions segment provides commercial cleaning and maintenance solution products under the Rubbermaid, Rubbermaid Commercial Products, Mapa, and Spontex brands; closet and garage organization products; hygiene systems and material handling solutions; household products, such as kitchen appliances under the Crockpot, Mr. Coffee, Oster, and Sunbeam brands; small appliances under the Breville brand name in Europe; food and home storage products under the FoodSaver, Rubbermaid, Ball, and Sistema brands; fresh preserving products; vacuum sealing products; and gourmet cookware, bakeware, and cutlery under the Calphalon brand; and home fragrance products under the WoodWick and Yankee Candle brands. The Learning and Development segment offers writing instruments, including markers and highlighters, pens, and pencils; art products; activity-based products; labeling solutions; and baby gear and infant care products under the Dymo, Elmer's, EXPO, Graco, NUK, Paper Mate, Parker, and Sharpie brands. The Outdoor and Recreation segment provides outdoor and outdoor-related products, inlcuding technical apparel and on-the-go beverageware under the Campingaz, Coleman, Contigo, and Marmot brands. It serves warehouse clubs, department and drug/grocery stores, mass merchants, home centers, commercial products distributors, specialty retailers, office superstores and supply stores, contract stationers, e-commerce retailers, and sporting goods, as well as direct to consumers online, select contract customers, and other professional customers. Newell Brands Inc. was founded in 1903 and is based in Atlanta, Georgia.

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.