Mattress Firm Holding Corp (NASDAQ: MFRM) and Vitamin Shoppe (NYSE:VSI) are both retail/wholesale companies, but which is the superior investment? We will compare the two companies based on the strength of their risk, valuation, earnings, profitabiliy, analyst recommendations, dividends and institutional ownership.

Insider and Institutional Ownership

75.9% of Mattress Firm Holding Corp shares are held by institutional investors. 6.0% of Mattress Firm Holding Corp shares are held by insiders. Comparatively, 1.1% of Vitamin Shoppe shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Profitability

This table compares Mattress Firm Holding Corp and Vitamin Shoppe’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Mattress Firm Holding Corp -2.68% 12.88% 3.02%
Vitamin Shoppe 1.43% 9.35% 5.73%

Valuation and Earnings

This table compares Mattress Firm Holding Corp and Vitamin Shoppe’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Mattress Firm Holding Corp N/A N/A N/A ($2.24) -28.58
Vitamin Shoppe $1.27 billion 0.21 $108.63 million $0.78 15.06

Vitamin Shoppe has higher revenue and earnings than Mattress Firm Holding Corp. Mattress Firm Holding Corp is trading at a lower price-to-earnings ratio than Vitamin Shoppe, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Mattress Firm Holding Corp has a beta of 0.96, indicating that its share price is 4% less volatile than the S&P 500. Comparatively, Vitamin Shoppe has a beta of 0.76, indicating that its share price is 24% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Mattress Firm Holding Corp and Vitamin Shoppe, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Mattress Firm Holding Corp 1 3 1 0 2.00
Vitamin Shoppe 1 5 1 0 2.00

Mattress Firm Holding Corp presently has a consensus target price of $64.00, indicating a potential downside of 0.05%. Vitamin Shoppe has a consensus target price of $23.50, indicating a potential upside of 100.00%. Given Vitamin Shoppe’s higher possible upside, analysts clearly believe Vitamin Shoppe is more favorable than Mattress Firm Holding Corp.

Summary

Vitamin Shoppe beats Mattress Firm Holding Corp on 5 of the 9 factors compared between the two stocks.

Mattress Firm Holding Corp Company Profile

Mattress Firm Holding Corp. is a holding company. The Company is a specialty retailer of mattresses and related products and accessories in the United States. It operates through two segments: retail operations and franchise operations. The retail operations segment includes Company-operated stores, e-commerce Website operations and multi-channel sales operations consisting of special events. The franchise operations segment includes franchise fees and royalty income received from its franchisees. The Company, through its subsidiaries, operates its business under the Mattress Firm brand name. With a range of styles, sizes, price points and features, it provides its customers with their choice of specialty and traditional mattresses from a range of brands, including Tempur Pedic, Sealy, Serta, Simmons, and Stearns & Foster. The Company and its franchisees operates over 2,400 stores under the Mattress Firm and Sleep Train brand names, in approximately 100 markets across over 40 states.

Vitamin Shoppe Company Profile

Vitamin Shoppe, Inc. (VSI) is a multi-channel specialty retailer and contract manufacturer of vitamins, minerals, herbs, specialty supplements, sports nutrition, and other health and wellness products. The Company operates through three segments: retail, direct and manufacturing. The retail segment includes Vitamin Shoppe, Super Supplements and Vitapath retail store formats. The direct segment sells its products directly to consumers through the Internet, primarily at www.vitaminshoppe.com. The manufacturing segment provides custom manufacturing and private labeling of vitamin, mineral and supplement products, and develops and markets its own branded products for both sales to third parties and for the VSI product assortment. As of December 31, 2016, it marketed approximately 900 brands, as well as its own brands. As of December 31, 2016, it operated 775 stores located in 45 states, the District of Columbia and Puerto Rico, primarily located in retail centers and standalone locations.

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