Build-A-Bear Workshop (NYSE:BBW – Get Free Report) and Arhaus (NASDAQ:ARHS – Get Free Report) 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 earnings, profitability, risk, analyst recommendations, dividends, institutional ownership and valuation.
Insider and Institutional Ownership
79.3% of Build-A-Bear Workshop shares are owned by institutional investors. Comparatively, 27.9% of Arhaus shares are owned by institutional investors. 5.8% of Build-A-Bear Workshop shares are owned by company insiders. Comparatively, 1.8% of Arhaus shares are owned by company 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.
Analyst Recommendations
This is a summary of current ratings and recommmendations for Build-A-Bear Workshop and Arhaus, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Build-A-Bear Workshop | 0 | 0 | 3 | 1 | 3.25 |
| Arhaus | 0 | 12 | 4 | 0 | 2.25 |
Profitability
This table compares Build-A-Bear Workshop and Arhaus’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Build-A-Bear Workshop | 11.34% | 41.14% | 19.56% |
| Arhaus | 5.33% | 20.08% | 5.62% |
Earnings & Valuation
This table compares Build-A-Bear Workshop and Arhaus”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Build-A-Bear Workshop | $496.40 million | 1.96 | $51.78 million | $4.46 | 16.59 |
| Arhaus | $1.27 billion | 1.19 | $68.55 million | $0.50 | 21.54 |
Arhaus has higher revenue and earnings than Build-A-Bear Workshop. Build-A-Bear Workshop is trading at a lower price-to-earnings ratio than Arhaus, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Build-A-Bear Workshop has a beta of 0.72, indicating that its stock price is 28% less volatile than the S&P 500. Comparatively, Arhaus has a beta of 2.58, indicating that its stock price is 158% more volatile than the S&P 500.
Summary
Build-A-Bear Workshop beats Arhaus on 9 of the 15 factors compared between the two stocks.
About Build-A-Bear Workshop
Build-A-Bear Workshop, Inc. operates as a multi-channel retailer of plush animals and related products in the United States, Canada, the United Kingdom, Ireland, and internationally. The company operates through three segments: Direct-to-Consumer, Commercial, and International Franchising. Its merchandise comprises various styles of plush products to be stuffed, pre-stuffed plush products, and sounds and scents that can be added to the stuffed animals, as well as range of clothing, shoes and accessories, and other toy and novelty items, including family sleepwear. The company operates its stores under the Build-A-Bear Workshop brand name; and sells its products through its e-commerce sites and third-party marketplace sites. Build-A-Bear Workshop, Inc. was founded in 1997 and is headquartered in Saint Louis, Missouri.
About Arhaus
Arhaus, Inc. operates as a lifestyle brand and premium retailer in the home furnishings market in the United States. It provides merchandise assortments across various categories, including furniture, lighting, textiles, décor, and outdoor. The company's furniture products comprise bedroom, dining room, living room, and home office furnishings, which includes sofas, dining tables and chairs, accent chairs, console and coffee tables, beds, headboards, dressers, desks, bookcases, modular storage, and other items; and outdoor products, such as outdoor dining tables, chairs, chaises and other furniture, lighting, textiles, décor, umbrellas, and fire pits. It offers lighting products, including various distinct and artistic lighting fixtures comprising chandeliers, pendants, table and floor lamps, and sconces; textile products, such as handcrafted indoor and outdoor rugs, bed linens, and pillows and throws; and décor products, including various wall art to mirrors, vases to candles, and other decorative accessories. The company distributes its products through an omni-channel model comprising showrooms, e-commerce platform, print and digital media, and in-home designer services. Arhaus, Inc. was founded in 1986 and is headquartered in Boston Heights, Ohio.
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