Critical Contrast: Frontdoor (NASDAQ:FTDR) vs. WW International (NASDAQ:WW)
by Tristan Rich · The Markets DailyFrontdoor (NASDAQ:FTDR – Get Free Report) and WW International (NASDAQ:WW – Get Free Report) are both consumer discretionary companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, earnings, valuation, analyst recommendations, dividends, risk and institutional ownership.
Profitability
This table compares Frontdoor and WW International’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Frontdoor | 12.72% | 120.90% | 14.86% |
| WW International | -56.84% | N/A | -0.32% |
Analyst Recommendations
This is a breakdown of current ratings and target prices for Frontdoor and WW International, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Frontdoor | 0 | 3 | 5 | 0 | 2.62 |
| WW International | 1 | 2 | 0 | 0 | 1.67 |
Frontdoor presently has a consensus target price of $92.60, indicating a potential upside of 14.26%. Given Frontdoor’s stronger consensus rating and higher possible upside, equities analysts clearly believe Frontdoor is more favorable than WW International.
Volatility & Risk
Frontdoor has a beta of 1.5, meaning that its share price is 50% more volatile than the S&P 500. Comparatively, WW International has a beta of 1.73, meaning that its share price is 73% more volatile than the S&P 500.
Institutional and Insider Ownership
86.2% of WW International shares are owned by institutional investors. 1.6% of Frontdoor shares are owned by insiders. Comparatively, 0.4% of WW International shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.
Valuation and Earnings
This table compares Frontdoor and WW International”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Frontdoor | $2.09 billion | 2.67 | $255.00 million | $3.77 | 21.50 |
| WW International | $710.64 million | 0.25 | -$112.25 million | ($10.13) | -1.78 |
Frontdoor has higher revenue and earnings than WW International. WW International is trading at a lower price-to-earnings ratio than Frontdoor, indicating that it is currently the more affordable of the two stocks.
Summary
Frontdoor beats WW International on 12 of the 14 factors compared between the two stocks.
About Frontdoor
Frontdoor, Inc. provides home warranties in the United States in the United States. Its customizable home warranties help customers protect and maintain their homes from costly and unplanned breakdowns of essential home systems and appliances. The company’s home warranty customers subscribe to an annual service plan agreement that covers the repair or replacement of principal components of approximately 20 home systems and appliances, including electrical, plumbing, water heaters, refrigerators, dishwashers, and ranges/ovens/cooktops, as well as electronics, pools, and spas and pumps; and heating, ventilation, and air conditioning systems. It also offers on-demand home services and a one-stop app experience for home repair and maintenance; and Streem technology, an app that empowers homeowners by connecting them in real time through video chat with qualified experts to diagnose and solve their problems. The company serves homeowners under the Frontdoor, American Home Shield, HSA, OneGuard, Landmark Home Warranty, Frontdoor logo, and Streem brands. The company was founded in 1971 and is headquartered in Memphis, Tennessee.
About WW International
WW International, Inc. provides weight management products and services worldwide. It offers a range of nutritional, activity, behavioral, and lifestyle tools and approaches products and services. The company also provides various digital subscription products to wellness and weight management business, which provide interactive and personalized resources that allow users to follow its weight management program through its app and web-based platform; and allows members to inspire and support each other by sharing their experiences with other people on weight health journeys. In addition, it licenses its trademarks and other intellectual property in food, beverages, and other relevant consumer products and services, as well as provides publishing services. The company was formerly known as Weight Watchers International, Inc. and changed its name to WW International, Inc. in September 2019. WW International, Inc. was founded in 1961 and is headquartered in New York, New York.