Head to Head Comparison: Lithia Motors (NYSE:LAD) versus Warby Parker (NYSE:WRBY)
by Mitch Edgeman · The Markets DailyWarby Parker (NYSE:WRBY – Get Free Report) and Lithia Motors (NYSE:LAD – Get Free Report) are both mid-cap consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, profitability, institutional ownership, dividends, valuation and risk.
Profitability
This table compares Warby Parker and Lithia Motors’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Warby Parker | 0.85% | 3.36% | 1.72% |
| Lithia Motors | 2.06% | 12.05% | 3.03% |
Insider & Institutional Ownership
93.2% of Warby Parker shares are owned by institutional investors. 16.8% of Warby Parker shares are owned by insiders. Comparatively, 1.1% of Lithia Motors shares are owned 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.
Earnings & Valuation
This table compares Warby Parker and Lithia Motors”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Warby Parker | $871.91 million | 3.15 | $1.64 million | $0.07 | 362.11 |
| Lithia Motors | $37.63 billion | 0.17 | $819.60 million | $34.76 | 8.25 |
Lithia Motors has higher revenue and earnings than Warby Parker. Lithia Motors is trading at a lower price-to-earnings ratio than Warby Parker, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a breakdown of recent ratings for Warby Parker and Lithia Motors, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Warby Parker | 1 | 3 | 6 | 0 | 2.50 |
| Lithia Motors | 0 | 6 | 6 | 0 | 2.50 |
Warby Parker presently has a consensus price target of $30.00, suggesting a potential upside of 18.35%. Lithia Motors has a consensus price target of $393.80, suggesting a potential upside of 37.39%. Given Lithia Motors’ higher possible upside, analysts plainly believe Lithia Motors is more favorable than Warby Parker.
Volatility & Risk
Warby Parker has a beta of 1.89, indicating that its stock price is 89% more volatile than the S&P 500. Comparatively, Lithia Motors has a beta of 1.27, indicating that its stock price is 27% more volatile than the S&P 500.
Summary
Lithia Motors beats Warby Parker on 7 of the 12 factors compared between the two stocks.
About Warby Parker
Warby Parker Inc. provides eyewear products in the United States and Canada. The company offers eyeglasses, sunglasses, light-responsive lenses, blue-light-filtering lenses, non-prescription lenses, and contact lenses. It also provides accessories, such as cases, lenses kit with anti-fog spray, pouches, and anti-fog lens spray through its retail stores, website, and mobile apps. In addition, the company offers eye exams and vision tests. Warby Parker Inc. was incorporated in 2009 and is headquartered in New York, New York.
About Lithia Motors
Lithia Motors, Inc. operates as an automotive retailer worldwide. It operates in two segments, Vehicle Operations and Financing Operations. The company’s Vehicle Operations segment sells new and used vehicles; provides parts, repair, and maintenance services; vehicle finance; and insurance products. Its Financing Operations segment provides financing to customers buying and leasing retail vehicles. The company sells its products and services through the Driveway and Greencars brand names through a network of locations, e-commerce platforms, and captive finance solutions. Lithia Motors, Inc. was founded in 1946 and is headquartered in Medford, Oregon.