Head to Head Analysis: Vipshop (NYSE:VIPS) & SEA (NYSE:SE)

SEA (NYSE:SE) and Vipshop (NYSE:VIPS) are both consumer discretionary companies, but which is the better stock? We will compare the two businesses based on the strength of their valuation, earnings, profitability, analyst recommendations, risk, institutional ownership and dividends.

Analyst Ratings

This is a breakdown of current ratings for SEA and Vipshop, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SEA	1	3	8	1	2.69
Vipshop	1	4	4	1	2.50

SEA currently has a consensus price target of $151.90, suggesting a potential upside of 24.72%. Vipshop has a consensus price target of $21.02, suggesting a potential upside of 48.67%. Given Vipshop’s higher probable upside, analysts plainly believe Vipshop is more favorable than SEA.

Valuation and Earnings

This table compares SEA and Vipshop”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SEA	$22.94 billion	3.24	$1.58 billion	$2.59	47.02
Vipshop	$15.15 billion	0.45	$1.04 billion	$2.13	6.64

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

Profitability

This table compares SEA and Vipshop’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
SEA	5.98%	13.54%	5.59%
Vipshop	7.08%	16.90%	9.47%

Volatility & Risk

SEA has a beta of 1.54, indicating that its share price is 54% more volatile than the S&P 500. Comparatively, Vipshop has a beta of 0.67, indicating that its share price is 33% less volatile than the S&P 500.

Insider & Institutional Ownership

59.5% of SEA shares are held by institutional investors. Comparatively, 48.8% of Vipshop shares are held by institutional investors. 0.2% of SEA shares are held by company insiders. Comparatively, 29.5% of Vipshop shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

SEA beats Vipshop on 9 of the 14 factors compared between the two stocks.

About SEA

Sea Ltd. is an internet and mobile platform company, which engages in the provision of online gaming services. It operates through the following segments: Digital Entertainment, E-Commerce, and Digital Financial Services. The Digital Entertainment segment offers and develops mobile and PC online games. The E-Commerce segment manages a third-party marketplace through the Shopee mobile app and websites that connect buyers and sellers. The Digital Financial Services segment includes a variety of payment services and loans to individuals and businesses through SeaMoney. Sea was founded by Xiao Dong Li, Gang Ye, and Jing Ye Chen on May 8, 2009 and is headquartered in Singapore.

About Vipshop

Vipshop Holdings Limited operates online platforms in the People's Republic of China. It operates in Vip.com, Shan Shan Outlets, and Others segments. The company offers womenswear, menswear, sportswear and sporting goods, shoes and bags, accessories, baby and children products, skincare and cosmetics, home goods and other lifestyle products, and supermarket products. It also provides internet finance services, including consumer and supplier financing. In addition, the company engages in warehousing, retail business, product procurement, and software development and information technology support activities. The company provides branded products through its vip.com and vipshop.com online platforms, as well as through retail stores. Vipshop Holdings Limited was founded in 2008 and is headquartered in Guangzhou, the People's Republic of China.