Party City Holdco (NYSE: PRTY) and Tractor Supply (NASDAQ:TSCO) are both consumer discretionary companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, risk, earnings, analyst recommendations, valuation and profitability.

Analyst Ratings

This is a breakdown of recent recommendations for Party City Holdco and Tractor Supply, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Party City Holdco 0 2 2 0 2.50
Tractor Supply 0 16 9 0 2.36

Party City Holdco currently has a consensus target price of $17.33, indicating a potential upside of 22.93%. Tractor Supply has a consensus target price of $74.40, indicating a potential upside of 39.09%. Given Tractor Supply’s higher possible upside, analysts clearly believe Tractor Supply is more favorable than Party City Holdco.

Profitability

This table compares Party City Holdco and Tractor Supply’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Party City Holdco 4.97% 13.97% 4.09%
Tractor Supply 6.16% 30.56% 15.64%

Dividends

Tractor Supply pays an annual dividend of $1.08 per share and has a dividend yield of 2.0%. Party City Holdco does not pay a dividend. Tractor Supply pays out 32.5% of its earnings in the form of a dividend.

Volatility & Risk

Party City Holdco has a beta of 2.69, meaning that its share price is 169% more volatile than the S&P 500. Comparatively, Tractor Supply has a beta of 1.32, meaning that its share price is 32% more volatile than the S&P 500.

Institutional & Insider Ownership

100.0% of Party City Holdco shares are held by institutional investors. Comparatively, 91.4% of Tractor Supply shares are held by institutional investors. 5.0% of Party City Holdco shares are held by company insiders. Comparatively, 1.2% of Tractor Supply shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Party City Holdco and Tractor Supply’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Party City Holdco $2.33 billion 0.72 $364.88 million $0.96 14.69
Tractor Supply $7.04 billion 0.97 $849.82 million $3.32 16.11

Tractor Supply has higher revenue and earnings than Party City Holdco. Party City Holdco is trading at a lower price-to-earnings ratio than Tractor Supply, indicating that it is currently the more affordable of the two stocks.

Summary

Tractor Supply beats Party City Holdco on 11 of the 16 factors compared between the two stocks.

Party City Holdco Company Profile

Party City Holdco Inc. is a holding company with no operating assets or operations. As of December 31, 2016, the Company owned PC Nextco Holdings, LLC (PC Nextco), which owned PC Intermediate Holdings, Inc. (PC Intermediate). As of December 31, 2016, PC Intermediate owned Party City Holdings Inc. (PCHI). PCHI or its direct or indirect subsidiaries conduct all of its operating businesses. The Company operates through two segments: Retail and Wholesale. Its retail operations generate revenue primarily through the sale of its Amscan, Designware, Anagram and Costumes USA party supplies through its Party City stores, Halloween City stores and PartyCity.com. Its wholesale revenues are generated from the sale of party goods for all occasions, including paper and plastic tableware, accessories and novelties, costumes, metallic and latex balloons and stationery.

Tractor Supply Company Profile

Tractor Supply Company is an operator of rural lifestyle retail stores in the United States. The Company is focused on supplying the needs of recreational farmers and ranchers and others, as well as tradesmen and small businesses. It is engaged in the retail sale of products that support the rural lifestyle. The Company operates retail stores under the names Tractor Supply Company, Del’s Feed & Farm Supply and Petsense, and operates Websites under the names TractorSupply.com and Petsense.com. The Company’s selection of merchandise consists of various product categories, including equine, livestock, pet and small animal products; hardware, truck, towing and tool products; seasonal products, including heating, lawn and garden items, power equipment, gifts and toys; work/recreational clothing and footwear, and maintenance products for agricultural and rural use. Its brands include 4health, JobSmart, Bit & Bridle, Paws & Claws, Blue Mountain, Redstone, Dumor, Equistages and Royal Wing.

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