Arhaus (NASDAQ:ARHS – Get Free Report) and Valvoline (NYSE:VVV – Get Free Report) are both consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, valuation, dividends, profitability, earnings, institutional ownership and risk.
Institutional & Insider Ownership
27.9% of Arhaus shares are held by institutional investors. Comparatively, 96.1% of Valvoline shares are held by institutional investors. 1.2% of Arhaus shares are held by insiders. Comparatively, 0.7% of Valvoline shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Profitability
This table compares Arhaus and Valvoline’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Arhaus | 4.91% | 17.23% | 4.94% |
| Valvoline | 5.17% | 65.12% | 7.11% |
Analyst Recommendations
This is a summary of current ratings and recommmendations for Arhaus and Valvoline, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Arhaus | 0 | 3 | 6 | 1 | 2.80 |
| Valvoline | 0 | 5 | 13 | 0 | 2.72 |
Arhaus presently has a consensus price target of $10.78, indicating a potential downside of 10.63%. Valvoline has a consensus price target of $41.17, indicating a potential upside of 21.69%. Given Valvoline’s higher probable upside, analysts clearly believe Valvoline is more favorable than Arhaus.
Risk & Volatility
Arhaus has a beta of 2.24, meaning that its stock price is 124% more volatile than the S&P 500. Comparatively, Valvoline has a beta of 1.01, meaning that its stock price is 1% more volatile than the S&P 500.
Valuation and Earnings
This table compares Arhaus and Valvoline”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Arhaus | $1.38 billion | 1.24 | $67.26 million | $0.50 | 24.12 |
| Valvoline | $1.71 billion | 2.52 | $210.70 million | $0.80 | 42.29 |
Valvoline has higher revenue and earnings than Arhaus. Arhaus is trading at a lower price-to-earnings ratio than Valvoline, indicating that it is currently the more affordable of the two stocks.
Summary
Valvoline beats Arhaus on 11 of the 15 factors compared between the two stocks.
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.
About Valvoline
Valvoline Inc. engages in the operation and franchising of vehicle service centers and retail stores in the United States and Canada. The company, through its service centers, provides fluid exchange for motor oil, transmission and differential fluid, and coolant; parts replacement for batteries, filters, wiper blades, and belts; and safety services, such as tire inflation and rotation, bulbs, and safety checks. It offers its services for passenger cars, hybrid and battery electric vehicles, and light and medium duty vehicles. The company was founded in 1866 and is headquartered in Lexington, Kentucky.
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