Reviewing Rent the Runway (NASDAQ:RENT) & Petco Health and Wellness (NASDAQ:WOOF)

Petco Health and Wellness (NASDAQ:WOOFGet Rating) and Rent the Runway (NASDAQ:RENTGet Rating) are both retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their risk, analyst recommendations, earnings, valuation, institutional ownership, dividends and profitability.

Profitability

This table compares Petco Health and Wellness and Rent the Runway’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Petco Health and Wellness 2.03% 7.96% 2.77%
Rent the Runway -76.30% -293.74% -37.01%

Valuation & Earnings

This table compares Petco Health and Wellness and Rent the Runway’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Petco Health and Wellness $5.81 billion 0.53 $164.42 million $0.45 30.27
Rent the Runway $203.30 million 0.84 -$211.80 million ($8.54) -0.31

Petco Health and Wellness has higher revenue and earnings than Rent the Runway. Rent the Runway is trading at a lower price-to-earnings ratio than Petco Health and Wellness, indicating that it is currently the more affordable of the two stocks.

Institutional and Insider Ownership

68.2% of Petco Health and Wellness shares are held by institutional investors. Comparatively, 78.9% of Rent the Runway shares are held by institutional investors. 0.6% of Petco Health and Wellness shares are held by insiders. Comparatively, 10.7% of Rent the Runway shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations for Petco Health and Wellness and Rent the Runway, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Petco Health and Wellness 0 2 7 0 2.78
Rent the Runway 0 2 9 0 2.82

Petco Health and Wellness currently has a consensus target price of $21.10, suggesting a potential upside of 54.92%. Rent the Runway has a consensus target price of $8.91, suggesting a potential upside of 233.67%. Given Rent the Runway’s stronger consensus rating and higher probable upside, analysts clearly believe Rent the Runway is more favorable than Petco Health and Wellness.

Summary

Petco Health and Wellness beats Rent the Runway on 7 of the 13 factors compared between the two stocks.

About Petco Health and Wellness

(Get Rating)

Petco Health and Wellness Company, Inc., a health and wellness company, focuses on enhancing the lives of pets, pet parents, and its Petco partners. The company provides veterinary care, grooming, training, tele-health, and Vital Care and pet health insurance services, as well as veterinary services through Vetco mobile clinics. It also offers pet consumables, supplies, and services through its petco.com, petcoach.co, petinsurancequotes.com, and pupbox.com websites. As of March 23, 2022, the company operated approximately 1,500 Petco locations in the United States, Mexico, and Puerto Rico that included a network of approximately 200 in-store veterinary hospitals. Petco Health and Wellness Company, Inc. was founded in 1965 and is headquartered in San Diego, California.

About Rent the Runway

(Get Rating)

Rent the Runway, Inc. rents designer wear for women through its stores and online retail. The company offers ready-to-wear, workwear, denim, casual, maternity, outerwear, blouses, knitwear, loungewear, jewelry, handbags, activewear, ski wear, home goods, evening wear, and kids wear, as well as accessories. It also engages in the software development and support activities. The company was incorporated in 2009 and is headquartered in Brooklyn, New York.

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