Ford Motor (NYSE:F – Get Free Report) and Vroom (NASDAQ:VRM – Get Free Report) are both auto/tires/trucks companies, but which is the superior business? We will contrast the two companies based on the strength of their analyst recommendations, profitability, dividends, risk, valuation, earnings and institutional ownership.
Risk and Volatility
Ford Motor has a beta of 1.65, meaning that its stock price is 65% more volatile than the S&P 500. Comparatively, Vroom has a beta of 1.25, meaning that its stock price is 25% more volatile than the S&P 500.
Profitability
This table compares Ford Motor and Vroom’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Ford Motor | -3.22% | 15.77% | 2.25% |
| Vroom | -37.16% | -51.07% | -6.63% |
Earnings and Valuation
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Ford Motor | $187.27 billion | 0.34 | -$8.18 billion | ($1.55) | -10.24 |
| Vroom | $178.83 million | 0.34 | -$7.96 million | ($12.76) | -0.92 |
Vroom has lower revenue, but higher earnings than Ford Motor. Ford Motor is trading at a lower price-to-earnings ratio than Vroom, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
58.7% of Ford Motor shares are held by institutional investors. Comparatively, 25.8% of Vroom shares are held by institutional investors. 0.6% of Ford Motor shares are held by company insiders. Comparatively, 2.9% of Vroom shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.
Analyst Ratings
This is a breakdown of current recommendations and price targets for Ford Motor and Vroom, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Ford Motor | 1 | 10 | 5 | 0 | 2.25 |
| Vroom | 1 | 0 | 0 | 0 | 1.00 |
Ford Motor presently has a consensus target price of $13.56, suggesting a potential downside of 14.60%. Given Ford Motor’s stronger consensus rating and higher probable upside, analysts clearly believe Ford Motor is more favorable than Vroom.
Summary
Ford Motor beats Vroom on 10 of the 14 factors compared between the two stocks.
About Ford Motor
Ford Motor Company develops, delivers, and services a range of Ford trucks, commercial cars and vans, sport utility vehicles, and Lincoln luxury vehicles worldwide. It operates through Ford Blue, Ford Model e, and Ford Pro; Ford Next; and Ford Credit segments. The company sells Ford and Lincoln vehicles, service parts, and accessories through distributors and dealers, as well as through dealerships to commercial fleet customers, daily rental car companies, and governments. It also engages in vehicle-related financing and leasing activities to and through automotive dealers. In addition, the company provides retail installment sale contracts for new and used vehicles; and direct financing leases for new vehicles to retail and commercial customers, such as leasing companies, government entities, daily rental companies, and fleet customers. Further, it offers wholesale loans to dealers to finance the purchase of vehicle inventory; and loans to dealers to finance working capital and enhance dealership facilities, purchase dealership real estate, and other dealer vehicle programs. The company was incorporated in 1903 and is based in Dearborn, Michigan.
About Vroom
Vroom, Inc. operates as an automotive finance company. The company offers vehicle financing to its customers through third party dealers under the UACC brand. It also provides artificial intelligence powered analytics and digital services to dealers, automotive financial services companies, and others in the automotive industry for automotive retail. The company was formerly known as Auto America, Inc. and changed its name to Vroom, Inc. in July 2015. Vroom, Inc. was incorporated in 2012 and is based in Houston, Texas.
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