Contrasting Central Garden & Pet (NASDAQ:CENT) & Barnes & Noble Education (NYSE:BNED)

Central Garden & Pet (NASDAQ:CENT) and Barnes & Noble Education (NYSE:BNED) are both small-cap consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their institutional ownership, profitability, analyst recommendations, dividends, valuation, earnings and risk.

Institutional and Insider Ownership

16.1% of Central Garden & Pet shares are held by institutional investors. Comparatively, 38.5% of Barnes & Noble Education shares are held by institutional investors. 8.2% of Central Garden & Pet shares are held by company insiders. Comparatively, 1.0% of Barnes & Noble Education shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Central Garden & Pet and Barnes & Noble Education’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Central Garden & Pet	4.44%	10.77%	4.65%
Barnes & Noble Education	N/A	N/A	N/A

Analyst Ratings

This is a summary of recent ratings for Central Garden & Pet and Barnes & Noble Education, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Central Garden & Pet	0	4	1	0	2.20
Barnes & Noble Education	1	0	0	0	1.00

Central Garden & Pet currently has a consensus target price of $40.00, suggesting a potential upside of 26.99%. Given Central Garden & Pet’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Central Garden & Pet is more favorable than Barnes & Noble Education.

Volatility and Risk

Central Garden & Pet has a beta of 0.66, meaning that its stock price is 34% less volatile than the S&P 500. Comparatively, Barnes & Noble Education has a beta of 1.78, meaning that its stock price is 78% more volatile than the S&P 500.

Valuation & Earnings

This table compares Central Garden & Pet and Barnes & Noble Education”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Central Garden & Pet	$3.12 billion	0.63	$107.98 million	$2.20	14.32
Barnes & Noble Education	$1.57 billion	0.16	-$63.21 million	($15.50)	-0.46

Central Garden & Pet has higher revenue and earnings than Barnes & Noble Education. Barnes & Noble Education is trading at a lower price-to-earnings ratio than Central Garden & Pet, indicating that it is currently the more affordable of the two stocks.

Summary

Central Garden & Pet beats Barnes & Noble Education on 12 of the 14 factors compared between the two stocks.

About Central Garden & Pet

Central Garden & Pet Co. engages in the production and distribution of branded and private label products for the lawn, garden, and pet supplies markets. It operates through the Pet and Garden segments. The Pet segment focuses on dog and cat supplies such as dog treats and chews, toys, pet beds and containment, grooming products, waste management and training pads, supplies for aquatics, small animals, reptiles and pet birds including toys, cages and habitats, bedding, food and supplements, products for equine and livestock, animal and household health and insect control products, live fish, and small animals, as well as outdoor cushions. The Garden segment includes lawn and garden consumables such as grass, vegetable, flower and herb seed, wild bird feed, bird houses and other birding accessories, weed, grass, and other herbicides, insecticide and pesticide products, fertilizers, and live plants. The company was founded by William E. Brown in 1980 and is headquartered in Walnut Creek, CA.

About Barnes & Noble Education

Barnes and Noble Education, Inc. engages in the management and operation of bookstore chains in universities. It operates through the Retail and Wholesale segments. The Retail segment operates college, university, and K-12 school bookstores, physical bookstores, and virtual bookstores. The Wholesale segment sells and distributes new and used textbooks to physical bookstores. The company was founded by Leonard S, Riggio in 1965 and is headquartered in Basking Ridge, NJ.