Financial Contrast: Driven Brands (NASDAQ:DRVN) and Tandy Leather Factory (NASDAQ:TLF)

Driven Brands (NASDAQ:DRVN) and Tandy Leather Factory (NASDAQ:TLF) are both consumer discretionary companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, analyst recommendations, valuation, institutional ownership, dividends, earnings and risk.

Earnings & Valuation

This table compares Driven Brands and Tandy Leather Factory”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Driven Brands	$1.86 billion	1.20	$140.16 million	$1.04	13.04
Tandy Leather Factory	$76.32 million	0.28	$9.10 million	($0.17)	-15.41

Driven Brands has higher revenue and earnings than Tandy Leather Factory. Tandy Leather Factory is trading at a lower price-to-earnings ratio than Driven Brands, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

77.1% of Driven Brands shares are owned by institutional investors. Comparatively, 56.4% of Tandy Leather Factory shares are owned by institutional investors. 4.4% of Driven Brands shares are owned by insiders. Comparatively, 36.2% of Tandy Leather Factory shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Risk and Volatility

Driven Brands has a beta of 0.94, suggesting that its share price is 6% less volatile than the S&P 500. Comparatively, Tandy Leather Factory has a beta of 0.5, suggesting that its share price is 50% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for Driven Brands and Tandy Leather Factory, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Driven Brands	0	7	5	2	2.64
Tandy Leather Factory	1	0	0	0	1.00

Driven Brands currently has a consensus price target of $16.77, indicating a potential upside of 23.71%. Given Driven Brands’ stronger consensus rating and higher possible upside, research analysts clearly believe Driven Brands is more favorable than Tandy Leather Factory.

Profitability

This table compares Driven Brands and Tandy Leather Factory’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Driven Brands	8.61%	24.13%	5.03%
Tandy Leather Factory	-2.14%	-3.31%	-1.98%

Summary

Driven Brands beats Tandy Leather Factory on 14 of the 15 factors compared between the two stocks.

About Driven Brands

Driven Brands Holdings Inc., together with its subsidiaries, provides automotive services to retail and commercial customers in the United States, Canada, and internationally. It offers various services, such as paint, collision, glass, repair, car wash, oil change, and maintenance services. The company also distributes automotive parts, including radiators, air conditioning components, and exhaust products to automotive repair shops, auto parts stores, body shops, and other auto repair outlets; windshields and glass accessories through a network of distribution centers; and consumable products, such as oil filters and wiper blades, as well as training services to repair and maintenance, and paint and collision shops. It sells its products and services under the CARSTAR, IMO, MAACO, Meineke Car Care Centers, PH Vitres D’Autos, Take 5 Oil Change, Take 5 Car Wash, Auto Glass Now, Fix Auto USA, and 1-800-Radiator & A/C, Spire Supply, and Automotive Training Institute brands. The company was founded in 1972 and is headquartered in Charlotte, North Carolina.

About Tandy Leather Factory

Tandy Leather Factory, Inc. engages in the distribution of leather and related products. It offers leather, leatherworking tools, buckles and adornments for belts, leather dyes and finishes, saddle and tack hardware, and do-it-yourself kits. It operates through North America and International geographical segments. The North America geographical segment consists of 115 stores, which offer a broad selection of products combined with leathercraft expertise in a one-stop shop. The International geographical segment comprises of similar to North America segment but generally located in light industrial areas. The company was founded by J. Wray Thompson, Sr. and Ronald C. Morgan in 1980 and is headquartered in Fort Worth, TX.