Groupon (NASDAQ:GRPN – Get Free Report) and Monotaro (OTCMKTS:MONOY – Get Free Report) are both consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their analyst recommendations, risk, dividends, profitability, earnings, valuation and institutional ownership.
Risk & Volatility
Groupon has a beta of 0.29, meaning that its share price is 71% less volatile than the S&P 500. Comparatively, Monotaro has a beta of 1.16, meaning that its share price is 16% more volatile than the S&P 500.
Insider & Institutional Ownership
90.0% of Groupon shares are held by institutional investors. Comparatively, 0.1% of Monotaro shares are held by institutional investors. 36.6% of Groupon shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
Analyst Recommendations
This is a summary of recent ratings for Groupon and Monotaro, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Groupon | 2 | 0 | 1 | 0 | 1.67 |
| Monotaro | 0 | 0 | 1 | 0 | 3.00 |
Groupon currently has a consensus target price of $23.00, suggesting a potential upside of 88.37%. Given Groupon’s higher probable upside, analysts plainly believe Groupon is more favorable than Monotaro.
Profitability
This table compares Groupon and Monotaro’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Groupon | -1.67% | N/A | -1.36% |
| Monotaro | 9.71% | 30.25% | 19.15% |
Earnings and Valuation
This table compares Groupon and Monotaro”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Groupon | $498.42 million | 0.98 | -$83.52 million | ($0.22) | -55.50 |
| Monotaro | $2.23 billion | 3.31 | $217.31 million | $0.47 | 31.74 |
Monotaro has higher revenue and earnings than Groupon. Groupon is trading at a lower price-to-earnings ratio than Monotaro, indicating that it is currently the more affordable of the two stocks.
Summary
Monotaro beats Groupon on 10 of the 13 factors compared between the two stocks.
About Groupon
Groupon, Inc. operates an online marketplace that connects consumers with local businesses. Through its website and mobile app, customers can discover and purchase offers on services and experiences such as dining, wellness, entertainment and activities. The company also provides merchants with a platform to promote their offerings and reach potential customers. Groupon has operated in North America and international markets, though the availability of its services and offers varies by location.
About Monotaro
MonotaRO Co., Ltd. operates an e-commerce business that supplies maintenance, repair and operations (MRO) products and other indirect materials to businesses. Its online store offers products such as tools, machine parts, safety equipment, automotive maintenance supplies and workplace items. The company serves customers across a range of industries, including manufacturing, construction and automotive services, primarily in Japan. Its online sales model helps businesses source a broad range of supplies through a single platform.
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