L’Oreal (OTCMKTS:LRLCY) & BRC (NYSE:BRCC) Critical Analysis

L’Oreal (OTCMKTS:LRLCY) and BRC (NYSE:BRCC) are both consumer staples companies, but which is the better investment? We will contrast the two businesses based on the strength of their profitability, analyst recommendations, earnings, institutional ownership, dividends, valuation and risk.

Volatility & Risk

L’Oreal has a beta of 0.9, indicating that its stock price is 10% less volatile than the S&P 500. Comparatively, BRC has a beta of 1.03, indicating that its stock price is 3% more volatile than the S&P 500.

Earnings and Valuation

This table compares L’Oreal and BRC”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
L’Oreal	$49.83 billion	4.75	$6.93 billion	N/A	N/A
BRC	$398.26 million	0.68	-$11.91 million	($0.14)	-7.75

L’Oreal has higher revenue and earnings than BRC.

Analyst Recommendations

This is a summary of recent recommendations for L’Oreal and BRC, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
L’Oreal	1	5	5	1	2.50
BRC	1	1	1	0	2.00

BRC has a consensus target price of $2.33, suggesting a potential upside of 115.05%. Given BRC’s higher probable upside, analysts clearly believe BRC is more favorable than L’Oreal.

Profitability

This table compares L’Oreal and BRC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
L’Oreal	N/A	N/A	N/A
BRC	-2.99%	-21.46%	-5.42%

Institutional and Insider Ownership

0.4% of L’Oreal shares are held by institutional investors. Comparatively, 16.3% of BRC shares are held by institutional investors. 54.9% of BRC shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Summary

L’Oreal beats BRC on 9 of the 13 factors compared between the two stocks.

About L’Oreal

L'Oréal S.A., through its subsidiaries, manufactures and sells cosmetic products for women and men worldwide. The company operates through four divisions: Consumer Products, L'oréal Luxe, Professional Products, and Dermatological Beauty. It offers skincare, make-up, hair colourants, haircare, perfumes, and hygiene products. The company provides its products under the L'Oréal Paris, Garnier, Maybelline New York, NYX Professional Makeup, Stylenanda, Essie, Dark & Lovely, Mixa, Magic Mask, Niley, Lancôme, Yves Saint Laurent, Armani, Kiehl's Since 1851, Helena Rubinstein, Biotherm, Shu Uemura, IT Cosmetics, Ralph Lauren Fragrance, Urban Decay, Mugler, Valentino, Viktor&Rolf, Azzaro, Prada, Cacharel, Maison Margela Fragrance, Diesel, Yue Sai, Atelier Colonge, Carita, Takami, Aesop, L'Oréal Professionnel Paris, Kérastase, Redken, Matrix, Pureology, Pulp Riot, La Roche-Posay, Vichy, CeraVe, SkinCeuticals, and Skinbetter Science brands. It sells its products through distribution channels, such as hair salons, local stores, e-commerce, travel retail, mass market retail, department store perfumeries, pharmacies, drug stores, medi-spas, and free-standing stores. L'Oréal S.A. was founded in 1909 and is headquartered in Clichy, France.

About BRC

BRC Inc., through its subsidiaries, purchases, roasts, and sells coffee, coffee accessories, and branded apparel in the United States. The company also produces media content, as well as sells coffee brewing equipment, and outdoor and lifestyle gear. It supports active military, veterans, and first responders. The company offers its products through grocery, specialty stores, and other intermediaries; and company operated and franchised Black Rifle Coffee retail coffee shop locations, as well as through e-commerce. BRC Inc. was founded in 2014 and is based in Salt Lake City, Utah.