Foxx Development (NASDAQ:FOXX) versus RLX Technology (NYSE:RLX) Critical Analysis

RLX Technology (NYSE:RLX) and Foxx Development (NASDAQ:FOXX) are both consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, valuation, risk, institutional ownership, earnings, analyst recommendations and dividends.

Earnings & Valuation

This table compares RLX Technology and Foxx Development”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RLX Technology	$376.55 million	10.16	$75.60 million	$0.07	34.79
Foxx Development	$65.92 million	0.51	-$9.02 million	($1.44)	-3.42

RLX Technology has higher revenue and earnings than Foxx Development. Foxx Development is trading at a lower price-to-earnings ratio than RLX Technology, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

RLX Technology has a beta of 1.09, meaning that its share price is 9% more volatile than the S&P 500. Comparatively, Foxx Development has a beta of -0.2, meaning that its share price is 120% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for RLX Technology and Foxx Development, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RLX Technology	0	2	0	0	2.00
Foxx Development	1	0	0	0	1.00

RLX Technology presently has a consensus target price of $2.25, suggesting a potential downside of 7.60%. Given RLX Technology’s stronger consensus rating and higher probable upside, research analysts clearly believe RLX Technology is more favorable than Foxx Development.

Profitability

This table compares RLX Technology and Foxx Development’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RLX Technology	21.05%	4.74%	4.44%
Foxx Development	-15.26%	N/A	-27.37%

Institutional & Insider Ownership

22.7% of RLX Technology shares are owned by institutional investors. Comparatively, 60.4% of Foxx Development shares are owned by institutional investors. 53.4% of RLX Technology shares are owned by insiders. Comparatively, 39.8% of Foxx Development shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Summary

RLX Technology beats Foxx Development on 12 of the 13 factors compared between the two stocks.

About RLX Technology

RLX Technology Inc., together with its subsidiaries, engages in the manufacture and sale of e-vapor products in the People's Republic of China and internationally. It serves partner distributors and retail outlets. The company was founded in 2018 and is headquartered in Beijing, China.

About Foxx Development

Foxx Development Holdings Inc. is a consumer electronics and integrated Internet-of-Things solution company catering to both retail and institutional clients. The company currently sells a diverse range of products including mobile phones, tablets and other consumer electronics devices principally in United State and is in the process of developing and distributing end-to-end communication terminals and IoT solutions. Foxx Development Holdings Inc., formerly known as Acri Capital Acquisition Corporation, is based in Austin, TX.