Financial Analysis: Procter & Gamble (NYSE:PG) and Warby Parker (NYSE:WRBY)

Warby Parker (NYSE:WRBY) and Procter & Gamble (NYSE:PG) are both consumer staples companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, valuation, risk, profitability, dividends, earnings and analyst recommendations.

Valuation and Earnings

This table compares Warby Parker and Procter & Gamble”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Warby Parker	$821.35 million	2.79	-$20.39 million	($0.07)	-311.64
Procter & Gamble	$84.28 billion	4.22	$15.97 billion	$6.51	23.37

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

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Warby Parker and Procter & Gamble, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Warby Parker	1	9	10	0	2.45
Procter & Gamble	0	9	11	0	2.55

Warby Parker currently has a consensus price target of $25.20, suggesting a potential upside of 15.52%. Procter & Gamble has a consensus price target of $171.68, suggesting a potential upside of 12.86%. Given Warby Parker’s higher probable upside, equities research analysts clearly believe Warby Parker is more favorable than Procter & Gamble.

Profitability

This table compares Warby Parker and Procter & Gamble’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Warby Parker	-1.12%	-0.79%	-0.41%
Procter & Gamble	18.95%	32.69%	13.49%

Insider and Institutional Ownership

93.2% of Warby Parker shares are owned by institutional investors. Comparatively, 65.8% of Procter & Gamble shares are owned by institutional investors. 18.2% of Warby Parker shares are owned by insiders. Comparatively, 0.2% of Procter & Gamble shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Risk & Volatility

Warby Parker has a beta of 2.1, indicating that its share price is 110% more volatile than the S&P 500. Comparatively, Procter & Gamble has a beta of 0.36, indicating that its share price is 64% less volatile than the S&P 500.

Summary

Procter & Gamble 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 Procter & Gamble

Procter & Gamble Co. engages in the provision of branded consumer packaged goods. It operates through the following segments: Beauty, Grooming, Health Care, Fabric and Home Care, and Baby, Feminine and Family Care. The Beauty segment offers hair, skin, and personal care. The Grooming segment consists of shave care like female and male blades and razors, pre and post shave products, and appliances. The Health Care segment includes oral care products like toothbrushes, toothpaste, and personal health care such as gastrointestinal, rapid diagnostics, respiratory, and vitamins, minerals, and supplements. The Fabric and Home care segment consists of fabric enhancers, laundry additives and detergents, and air, dish, and surface care. The Baby, Feminine and Family Care segment sells baby wipes, diapers, and pants, adult incontinence, feminine care, paper towels, tissues, and toilet paper. The company was founded by William Procter and James Gamble in 1837 and is headquartered in Cincinnati, OH.