GrowGeneration (NASDAQ:GRWG – Get Free Report) and Sportsman’s Warehouse (NASDAQ:SPWH – Get Free Report) are both small-cap consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, earnings, risk, dividends, profitability and analyst recommendations.
Valuation & Earnings
This table compares GrowGeneration and Sportsman’s Warehouse”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| GrowGeneration | $161.74 million | 0.57 | -$24.05 million | ($0.27) | -5.81 |
| Sportsman’s Warehouse | $1.21 billion | 0.04 | -$50.06 million | ($1.23) | -1.01 |
Institutional and Insider Ownership
36.0% of GrowGeneration shares are held by institutional investors. Comparatively, 83.0% of Sportsman’s Warehouse shares are held by institutional investors. 8.1% of GrowGeneration shares are held by insiders. Comparatively, 3.8% of Sportsman’s Warehouse shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Volatility and Risk
GrowGeneration has a beta of 2.56, meaning that its share price is 156% more volatile than the S&P 500. Comparatively, Sportsman’s Warehouse has a beta of 0.42, meaning that its share price is 58% less volatile than the S&P 500.
Profitability
This table compares GrowGeneration and Sportsman’s Warehouse’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| GrowGeneration | -10.07% | -17.44% | -11.52% |
| Sportsman’s Warehouse | -3.94% | -10.50% | -2.29% |
Analyst Recommendations
This is a summary of current ratings for GrowGeneration and Sportsman’s Warehouse, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| GrowGeneration | 1 | 1 | 1 | 0 | 2.00 |
| Sportsman’s Warehouse | 1 | 2 | 1 | 0 | 2.00 |
GrowGeneration currently has a consensus target price of $2.50, suggesting a potential upside of 59.24%. Sportsman’s Warehouse has a consensus target price of $2.12, suggesting a potential upside of 71.37%. Given Sportsman’s Warehouse’s higher possible upside, analysts clearly believe Sportsman’s Warehouse is more favorable than GrowGeneration.
Summary
Sportsman’s Warehouse beats GrowGeneration on 7 of the 12 factors compared between the two stocks.
About GrowGeneration
GrowGeneration Corp., through its subsidiaries, owns and operates retail hydroponic and organic gardening stores in the United States. The company engages in the marketing and distribution of nutrients, additives, growing media, lighting, and environmental control systems, as well as other indoor and outdoor growing products. It operates a chain of stores in California, Colorado, Michigan, Maine, Oklahoma, Oregon, Washington, Montana, New York, Ohio, Mississippi, Missouri, Arizona, Rhode Island, Florida, Massachusetts, Virginia, New Jersey, and New Mexico, as well as growgeneration.com, an online superstore for cultivators, a wholesale business for resellers, HRG Distribution, and benching, racking, and storage solutions and MMI. The company was formerly known as Easylife Corp. GrowGeneration Corp. was founded in 2008 and is based in Greenwood Village, Colorado.
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.
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