Contrasting Central Garden & Pet (NASDAQ:CENT) and RealReal (NASDAQ:REAL)

RealReal (NASDAQ:REAL) and Central Garden & Pet (NASDAQ:CENT) are both consumer discretionary companies, but which is the superior investment? We will compare the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, dividends and valuation.

Insider and Institutional Ownership

64.7% of RealReal shares are held by institutional investors. Comparatively, 16.1% of Central Garden & Pet shares are held by institutional investors. 9.0% of RealReal shares are held by insiders. Comparatively, 8.2% of Central Garden & Pet shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Earnings & Valuation

This table compares RealReal and Central Garden & Pet”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RealReal	$692.84 million	1.57	-$41.80 million	($1.09)	-8.37
Central Garden & Pet	$3.13 billion	0.71	$162.84 million	$2.45	14.62

Central Garden & Pet has higher revenue and earnings than RealReal. RealReal is trading at a lower price-to-earnings ratio than Central Garden & Pet, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for RealReal and Central Garden & Pet, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RealReal	1	2	5	1	2.67
Central Garden & Pet	0	3	1	1	2.60

RealReal currently has a consensus price target of $18.06, suggesting a potential upside of 98.05%. Central Garden & Pet has a consensus price target of $42.50, suggesting a potential upside of 18.68%. Given RealReal’s stronger consensus rating and higher probable upside, equities analysts clearly believe RealReal is more favorable than Central Garden & Pet.

Profitability

This table compares RealReal and Central Garden & Pet’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RealReal	-6.03%	N/A	-0.63%
Central Garden & Pet	5.04%	10.99%	4.75%

Volatility & Risk

RealReal has a beta of 2.81, suggesting that its share price is 181% more volatile than the S&P 500. Comparatively, Central Garden & Pet has a beta of 0.63, suggesting that its share price is 37% less volatile than the S&P 500.

About RealReal

The RealReal, Inc. operates an online marketplace for resale luxury goods in the United State. The company offers various product categories, including women's fashion, men's fashion, jewelry, and watches. It primarily sells products through online marketplace and retail stores. The company was incorporated in 2011 and is headquartered in San Francisco, California.

About Central Garden & Pet

Central Garden & Pet Co. engages in the production and distribution of branded and private label products for the lawn, garden, and pet supplies markets. It operates through the Pet and Garden segments. The Pet segment focuses on dog and cat supplies such as dog treats and chews, toys, pet beds and containment, grooming products, waste management and training pads, supplies for aquatics, small animals, reptiles and pet birds including toys, cages and habitats, bedding, food and supplements, products for equine and livestock, animal and household health and insect control products, live fish, and small animals, as well as outdoor cushions. The Garden segment includes lawn and garden consumables such as grass, vegetable, flower and herb seed, wild bird feed, bird houses and other birding accessories, weed, grass, and other herbicides, insecticide and pesticide products, fertilizers, and live plants. The company was founded by William E. Brown in 1980 and is headquartered in Walnut Creek, CA.