Head to Head Analysis: Bath & Body Works (NYSE:BBWI) and Carvana (NYSE:CVNA)
by Michael Walen · The Markets DailyCarvana (NYSE:CVNA – Get Free Report) and Bath & Body Works (NYSE:BBWI – Get Free Report) are both consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, dividends, valuation, earnings and profitability.
Analyst Ratings
This is a summary of recent ratings and recommmendations for Carvana and Bath & Body Works, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Carvana | 0 | 8 | 16 | 1 | 2.72 |
| Bath & Body Works | 1 | 15 | 4 | 0 | 2.15 |
Carvana currently has a consensus price target of $82.83, indicating a potential upside of 43.41%. Bath & Body Works has a consensus price target of $22.13, indicating a potential upside of 5.58%. Given Carvana’s stronger consensus rating and higher probable upside, analysts clearly believe Carvana is more favorable than Bath & Body Works.
Profitability
This table compares Carvana and Bath & Body Works’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Carvana | 6.26% | 37.06% | 12.21% |
| Bath & Body Works | 10.83% | -53.48% | 13.40% |
Institutional & Insider Ownership
56.7% of Carvana shares are held by institutional investors. Comparatively, 95.1% of Bath & Body Works shares are held by institutional investors. 15.2% of Carvana shares are held by company insiders. Comparatively, 0.3% of Bath & Body Works shares are held by company 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.
Earnings & Valuation
This table compares Carvana and Bath & Body Works”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Carvana | $20.32 billion | 3.13 | $1.41 billion | $1.81 | 31.91 |
| Bath & Body Works | $7.21 billion | 0.59 | $649.00 million | $3.84 | 5.46 |
Carvana has higher revenue and earnings than Bath & Body Works. Bath & Body Works is trading at a lower price-to-earnings ratio than Carvana, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Carvana has a beta of 3.55, meaning that its stock price is 255% more volatile than the S&P 500. Comparatively, Bath & Body Works has a beta of 1.4, meaning that its stock price is 40% more volatile than the S&P 500.
Summary
Carvana beats Bath & Body Works 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 Bath & Body Works
Bath & Body Works, Inc. is a specialty retailers and home to America’s Favorite Fragrances, offering a breadth of exclusive fragrances for the body and home, including the selling collections for fine fragrance mist, body lotion and body cream, 3-wick candles, home fragrance diffusers and liquid hand soap. The company was founded by Leslie Herbert Wexner in 1963 and is headquartered in Columbus, OH.