America’s Car-Mart (NASDAQ:CRMT) vs. Abercrombie & Fitch (NYSE:ANF) Critical Comparison

America’s Car-Mart (NASDAQ:CRMT) and Abercrombie & Fitch (NYSE:ANF) are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, dividends, risk, valuation, profitability and analyst recommendations.

Institutional and Insider Ownership

89.1% of America’s Car-Mart shares are held by institutional investors. 18.4% of America’s Car-Mart shares are held by insiders. Comparatively, 2.3% of Abercrombie & Fitch shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares America’s Car-Mart and Abercrombie & Fitch”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
America’s Car-Mart	$1.28 billion	0.01	-$139.11 million	($23.80)	-0.03
Abercrombie & Fitch	$5.27 billion	1.25	$506.92 million	$11.68	13.31

Abercrombie & Fitch has higher revenue and earnings than America’s Car-Mart. America’s Car-Mart is trading at a lower price-to-earnings ratio than Abercrombie & Fitch, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares America’s Car-Mart and Abercrombie & Fitch’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
America’s Car-Mart	-18.21%	-15.19%	-4.73%
Abercrombie & Fitch	10.03%	33.52%	13.05%

Risk & Volatility

America’s Car-Mart has a beta of 1.34, meaning that its stock price is 34% more volatile than the S&P 500. Comparatively, Abercrombie & Fitch has a beta of 1.02, meaning that its stock price is 2% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for America’s Car-Mart and Abercrombie & Fitch, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
America’s Car-Mart	1	2	0	0	1.67
Abercrombie & Fitch	0	5	9	2	2.81

America’s Car-Mart presently has a consensus target price of $14.00, suggesting a potential upside of 1,657.03%. Abercrombie & Fitch has a consensus target price of $157.21, suggesting a potential upside of 1.09%. Given America’s Car-Mart’s higher possible upside, equities analysts clearly believe America’s Car-Mart is more favorable than Abercrombie & Fitch.

Summary

Abercrombie & Fitch beats America’s Car-Mart on 10 of the 14 factors compared between the two stocks.

About America’s Car-Mart

America’s Car-Mart, Inc., through its subsidiaries, operates as an automotive retailer for the used car market in the United States. It primarily sells older model used vehicles and provides financing for its customers. The company was founded in 1981 and is headquartered in Rogers, Arkansas.

About Abercrombie & Fitch

Abercrombie & Fitch Co. engages in the retail of apparel, personal care products, and accessories. The firm operates through following geographical segments: Americas, EMEA and APAC. The Americas segment includes operations in North America and South America. The EMEA segment includes operations in Europe, the Middle East and Africa. The APAC segment includes operations in the Asia-Pacific region, including Asia and Oceania. The company was founded by David Abercrombie in 1892 and is headquartered in New Albany, OH.