Sportsman’s Warehouse (NASDAQ:SPWH – Get Free Report) and Arhaus (NASDAQ:ARHS – Get Free Report) are both small-cap consumer discretionary companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, earnings, profitability, analyst recommendations, institutional ownership, valuation and dividends.
Profitability
This table compares Sportsman’s Warehouse and Arhaus’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Sportsman’s Warehouse | -3.94% | -10.50% | -2.29% |
| Arhaus | 4.91% | 17.23% | 4.94% |
Institutional and Insider Ownership
83.0% of Sportsman’s Warehouse shares are owned by institutional investors. Comparatively, 27.9% of Arhaus shares are owned by institutional investors. 3.8% of Sportsman’s Warehouse shares are owned by company insiders. Comparatively, 1.2% of Arhaus shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Sportsman’s Warehouse | $1.21 billion | 0.04 | -$50.06 million | ($1.23) | -0.99 |
| Arhaus | $1.38 billion | 0.93 | $67.26 million | $0.50 | 18.14 |
Arhaus has higher revenue and earnings than Sportsman’s Warehouse. Sportsman’s Warehouse 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
Sportsman’s Warehouse has a beta of 0.42, meaning that its stock price is 58% less volatile than the S&P 500. Comparatively, Arhaus has a beta of 2.3, meaning that its stock price is 130% more volatile than the S&P 500.
Analyst Ratings
This is a summary of recent ratings and price targets for Sportsman’s Warehouse and Arhaus, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Sportsman’s Warehouse | 1 | 2 | 1 | 0 | 2.00 |
| Arhaus | 0 | 5 | 5 | 0 | 2.50 |
Sportsman’s Warehouse presently has a consensus target price of $2.12, suggesting a potential upside of 74.61%. Arhaus has a consensus target price of $10.22, suggesting a potential upside of 12.69%. Given Sportsman’s Warehouse’s higher possible upside, analysts clearly believe Sportsman’s Warehouse is more favorable than Arhaus.
Summary
Arhaus beats Sportsman’s Warehouse on 11 of the 14 factors compared between the two stocks.
About Sportsman’s Warehouse
Sportsman’s Warehouse Holdings, Inc. engages in the retail of sporting and athletic goods. Its products include hunting and shooting, archery, fishing, camping, boating accessories, optics and electronics, knives and tools, and footwear. The company was founded in 1986 and is headquartered in West Jordan, UT.
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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