Carvana (NYSE:CVNA – Get Free Report) and ARKO (NASDAQ:ARKO – Get Free Report) are both consumer discretionary companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, earnings, analyst recommendations, institutional ownership, profitability, valuation and risk.
Risk and Volatility
Carvana has a beta of 3.55, meaning that its share price is 255% more volatile than the S&P 500. Comparatively, ARKO has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500.
Earnings & Valuation
This table compares Carvana and ARKO”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Carvana | $20.32 billion | 3.18 | $1.41 billion | $1.81 | 32.44 |
| ARKO | $7.64 billion | 0.06 | $22.74 million | $0.07 | 57.64 |
Carvana has higher revenue and earnings than ARKO. Carvana is trading at a lower price-to-earnings ratio than ARKO, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
56.7% of Carvana shares are owned by institutional investors. Comparatively, 78.3% of ARKO shares are owned by institutional investors. 15.2% of Carvana shares are owned by insiders. Comparatively, 21.9% of ARKO shares are owned 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.
Analyst Recommendations
This is a breakdown of current ratings and target prices for Carvana and ARKO, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Carvana | 0 | 8 | 16 | 1 | 2.72 |
| ARKO | 1 | 1 | 1 | 0 | 2.00 |
Carvana currently has a consensus target price of $83.04, indicating a potential upside of 41.43%. ARKO has a consensus target price of $14.50, indicating a potential upside of 259.36%. Given ARKO’s higher probable upside, analysts plainly believe ARKO is more favorable than Carvana.
Profitability
This table compares Carvana and ARKO’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Carvana | 6.26% | 37.06% | 12.21% |
| ARKO | 0.19% | 4.02% | 0.41% |
Summary
Carvana beats ARKO on 11 of the 15 factors compared between the two stocks.
About Carvana
Carvana Co., together with its subsidiaries, operates an e-commerce platform for buying and selling used cars in the United States. Its platform allows customers to research and identify a vehicle; inspect it using company's 360-degree vehicle imaging technology; obtain financing and warranty coverage; purchase the vehicle; and schedule delivery or pick-up from their desktop or mobile devices. The company also operates auction sites. The company was founded in 2012 and is based in Tempe, Arizona.
About ARKO
Arko Corp. operates convenience stores in the United States. It operates through Retail, Wholesale, Fleet Fueling, and GPMP segments. The Retail segment engages in the sale of fuel and merchandise to retail consumers. Its Wholesale segment supplies fuel to third-party dealers and consignment agents. The Fleet Fueling segment supplies fuel to proprietary and third-party cardlock, and issuance of proprietary fuel cards. Its GPMP segment supplies fuel to retail and wholesale segments. The company is based in Richmond, Virginia.
Receive News & Ratings for Carvana Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Carvana and related companies with MarketBeat.com's FREE daily email newsletter.
