Comparing Home Depot (NYSE:HD) & Warby Parker (NYSE:WRBY)

Home Depot (NYSE:HD) and Warby Parker (NYSE:WRBY) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, dividends, valuation, analyst recommendations, institutional ownership, profitability and earnings.

Institutional and Insider Ownership

70.9% of Home Depot shares are held by institutional investors. Comparatively, 93.2% of Warby Parker shares are held by institutional investors. 0.1% of Home Depot shares are held by insiders. Comparatively, 16.8% of Warby Parker shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Home Depot and Warby Parker”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Home Depot	$164.68 billion	1.79	$14.16 billion	$14.29	20.69
Warby Parker	$871.91 million	3.10	$1.64 million	$0.07	356.54

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

Profitability

This table compares Home Depot and Warby Parker’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Home Depot	8.41%	106.42%	13.76%
Warby Parker	0.85%	3.36%	1.72%

Analyst Ratings

This is a breakdown of current recommendations for Home Depot and Warby Parker, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Home Depot	1	13	18	1	2.58
Warby Parker	1	3	6	0	2.50

Home Depot presently has a consensus target price of $375.93, indicating a potential upside of 27.16%. Warby Parker has a consensus target price of $30.00, indicating a potential upside of 20.20%. Given Home Depot’s stronger consensus rating and higher probable upside, research analysts plainly believe Home Depot is more favorable than Warby Parker.

Risk & Volatility

Home Depot has a beta of 1, meaning that its share price has a similar volatility profile to the S&P 500.Comparatively, Warby Parker has a beta of 1.89, meaning that its share price is 89% more volatile than the S&P 500.

Summary

Home Depot beats Warby Parker on 10 of the 15 factors compared between the two stocks.

About Home Depot

The Home Depot, Inc. operates as a home improvement retailer in the United States and internationally. It sells various building materials, home improvement products, lawn and garden products, and décor products, as well as facilities maintenance, repair, and operations products. The company also offers installation services for flooring, water heaters, bath, garage doors, cabinets, cabinet makeovers, countertops, sheds, furnaces and central air systems, and windows. In addition, it provides tool and equipment rental services. The company primarily serves homeowners; and professional renovators/remodelers, general contractors, maintenance professionals, handymen, property managers, and building service contractors, as well as specialty tradesmen, such as electricians, plumbers, and painters. It sells its products through websites, including homedepot.com; homedepot.ca and homedepot.com.mx; blinds.com, justblinds.com, and americanblinds.com for custom window coverings; thecompanystore.com, an online site for textiles and décor products; hdsupply.com for maintenance, repair, and operations (MRO) products and related services; and The Home Depot stores. The Home Depot, Inc. was incorporated in 1978 and is headquartered in Atlanta, Georgia.

About Warby Parker

Warby Parker Inc. provides eyewear products in the United States and Canada. The company offers eyeglasses, sunglasses, light-responsive lenses, blue-light-filtering lenses, non-prescription lenses, and contact lenses. It also provides accessories, such as cases, lenses kit with anti-fog spray, pouches, and anti-fog lens spray through its retail stores, website, and mobile apps. In addition, the company offers eye exams and vision tests. Warby Parker Inc. was incorporated in 2009 and is headquartered in New York, New York.