Analyzing Build-A-Bear Workshop (NYSE:BBW) & Grabagun Digital (NYSE:PEW)

Build-A-Bear Workshop (NYSE:BBW) and Grabagun Digital (NYSE:PEW) are both small-cap consumer discretionary companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, valuation, profitability, earnings, dividends, analyst recommendations and institutional ownership.

Profitability

This table compares Build-A-Bear Workshop and Grabagun Digital’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Build-A-Bear Workshop	9.96%	29.66%	13.60%
Grabagun Digital	-6.42%	-6.15%	-5.16%

Risk & Volatility

Build-A-Bear Workshop has a beta of 1.11, suggesting that its stock price is 11% more volatile than the S&P 500. Comparatively, Grabagun Digital has a beta of -0.01, suggesting that its stock price is 101% less volatile than the S&P 500.

Earnings and Valuation

This table compares Build-A-Bear Workshop and Grabagun Digital”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Build-A-Bear Workshop	$517.75 million	0.74	$52.20 million	$4.03	7.71
Grabagun Digital	$96.45 million	0.58	-$2.51 million	($0.23)	-8.20

Build-A-Bear Workshop has higher revenue and earnings than Grabagun Digital. Grabagun Digital is trading at a lower price-to-earnings ratio than Build-A-Bear Workshop, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations for Build-A-Bear Workshop and Grabagun Digital, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Build-A-Bear Workshop	0	2	2	0	2.50
Grabagun Digital	1	0	1	0	2.00

Build-A-Bear Workshop presently has a consensus target price of $53.50, indicating a potential upside of 72.19%. Grabagun Digital has a consensus target price of $5.00, indicating a potential upside of 165.25%. Given Grabagun Digital’s higher probable upside, analysts clearly believe Grabagun Digital is more favorable than Build-A-Bear Workshop.

Insider & Institutional Ownership

79.3% of Build-A-Bear Workshop shares are held by institutional investors. Comparatively, 4.8% of Grabagun Digital shares are held by institutional investors. 4.0% of Build-A-Bear Workshop shares are held by insiders. Comparatively, 27.8% of Grabagun Digital shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Build-A-Bear Workshop beats Grabagun Digital on 12 of the 14 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 Grabagun Digital

GrabAGun.com is an online retailer of firearms, ammunition and related accessories. GrabAGun.com, formerly known as Colombier Acquisition Corp. II, is based in COPPELL, Texas.