Nova Lifestyle (NASDAQ:NVFY – Get Free Report) and Dorel Industries (OTCMKTS:DIIBF – Get Free Report) 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, analyst recommendations, risk, valuation, earnings and dividends.
Insider & Institutional Ownership
27.2% of Nova Lifestyle shares are owned by institutional investors. 1.3% of Nova Lifestyle shares are owned by insiders. Comparatively, 19.3% of Dorel Industries shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Volatility & Risk
Nova Lifestyle has a beta of 1.21, suggesting that its stock price is 21% more volatile than the S&P 500. Comparatively, Dorel Industries has a beta of 1.8, suggesting that its stock price is 80% more volatile than the S&P 500.
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Nova Lifestyle | 1 | 0 | 0 | 0 | 1.00 |
| Dorel Industries | 0 | 0 | 0 | 0 | 0.00 |
Profitability
This table compares Nova Lifestyle and Dorel Industries’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Nova Lifestyle | -42.53% | -107.37% | -43.32% |
| Dorel Industries | -15.40% | -299.25% | -16.94% |
Earnings & Valuation
This table compares Nova Lifestyle and Dorel Industries”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Nova Lifestyle | $9.81 million | 22.71 | -$5.56 million | ($0.77) | -7.01 |
| Dorel Industries | $1.38 billion | 0.03 | -$171.96 million | ($5.84) | -0.18 |
Nova Lifestyle has higher earnings, but lower revenue than Dorel Industries. Nova Lifestyle is trading at a lower price-to-earnings ratio than Dorel Industries, indicating that it is currently the more affordable of the two stocks.
About Nova Lifestyle
Nova LifeStyle, Inc., through its subsidiaries, designs, manufactures, markets, and sells residential and commercial furniture for middle and upper middle-income consumers worldwide. The company offers upholstered, wood, and metal-based furniture pieces for the living, dining, and bedrooms, as well as home offices. Its products include sofas, chairs, dining tables, beds, entertainment consoles, cabinets, and cupboards. The company also provides physiotherapeutic jade mats for use in therapy clinic, hospitality, and real estate projects. It distributes its products under the Nova LifeStyle, Diamond Sofa, and Nova Living brand directly, as well as through internet sales and online marketing campaigns, and participation in exhibitions and trade shows primarily to furniture distributors and retailers. The company was formerly known as Stevens Resources, Inc. Nova LifeStyle, Inc. was founded in 2003 and is headquartered in Commerce, California.
About Dorel Industries
Dorel Industries Inc. engages in the design, manufacture, sourcing, marketing, and distribution of home and juvenile products worldwide. The company operates through Dorel Home and Dorel Juvenile segments. The Dorel Home segment offers ready-to assemble furniture and home furnishings products, including metal folding furniture, futons, children's furniture, step stools, hand trucks, ladders, outdoor furniture, and other imported furniture items. This segment markets its products under the DHP, Signature Sleep, Little Seeds, Ameriwood Home, Cosco Home & Office, Queer Eye, Cosmo Living, Novogratz, Real Rooms, Mr. Kate, Baby Relax, Alphason, Bertini, Ntense, and Notio brands. The Dorel Juvenile segment provides children's accessories comprising infant car seats, strollers, home equipment, toys, infant health, and safety aids under the Maxi-Cosi, Tiny Love, Infanti, Safety 1st, Bébé Confort, Quinny, and Cosco brands. The company was formerly known as Dorel Co. Ltd. and changed its name to Dorel Industries Inc. in May 1987. Dorel Industries Inc. was incorporated in 1962 and is headquartered in Westmount, Canada.
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