Honest (NASDAQ:HNST) versus Charlotte’s Web (OTCMKTS:CWBHF) Head-To-Head Review

Charlotte’s Web (OTCMKTS:CWBHF) and Honest (NASDAQ:HNST) are both consumer staples companies, but which is the better investment? We will contrast the two companies based on the strength of their risk, dividends, profitability, valuation, institutional ownership, analyst recommendations and earnings.

Profitability

This table compares Charlotte’s Web and Honest’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Charlotte’s Web	N/A	N/A	N/A
Honest	-3.56%	4.31%	3.33%

Insider & Institutional Ownership

45.5% of Honest shares are owned by institutional investors. 9.4% of Honest shares are owned 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.

Analyst Recommendations

This is a breakdown of current ratings for Charlotte’s Web and Honest, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Charlotte’s Web	0	0	0	0	0.00
Honest	2	4	2	1	2.22

Honest has a consensus target price of $4.38, suggesting a potential downside of 14.87%. Given Honest’s stronger consensus rating and higher probable upside, analysts clearly believe Honest is more favorable than Charlotte’s Web.

Earnings and Valuation

This table compares Charlotte’s Web and Honest”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Charlotte’s Web	N/A	N/A	N/A	N/A	N/A
Honest	$371.32 million	1.53	-$15.69 million	($0.11)	-46.77

Charlotte’s Web has higher earnings, but lower revenue than Honest.

Summary

Honest beats Charlotte’s Web on 9 of the 10 factors compared between the two stocks.

About Charlotte’s Web

Charlotte's Web Holdings, Inc. is involved in the farming, manufacture, marketing, and sale of hemp-derived cannabidiol (CBD) wellness products. The company's products categories include hemp extract oil tinctures, such as liquid products; gummies; and capsules, CBD topical creams, and lotions, as well as products for pets under the Charlotte's Web, ReCreate, CBD Medic, CBD Clinic, and Harmony Hemp brands. Its products contain naturally occurring phytocannabinoids, including CBD, cannabichromene, cannabigerol, cannabinol, terpenes, flavonoids, and other beneficial hemp compounds. The company distributes its products through retail outlets and health care practitioners, as well as online through its website. It has a collaboration between its CW Labs science division and Colorado State University's College of Agricultural Sciences; and scientific collaboration with McLean Hospital. The company was formerly known as Stanley Brothers Holdings Inc. and changed its name to Charlotte's Web Holdings, Inc. in July 2018. The company was founded in 2013 and is headquartered in Louisville, Colorado.

About Honest

The Honest Company, Inc. manufactures and sells diapers and wipes, skin and personal care, and household and wellness products. The company also offers baby clothing and nursery bedding products. It sells its products through digital and retail sales channels, such as its website and third-party ecommerce sites, as well as brick and mortar retailers. The company was incorporated in 2012 and is headquartered in Los Angeles, California.