Critical Analysis: RLX Technology (NYSE:RLX) and Ceconomy (OTCMKTS:MTTRY)

RLX Technology (NYSE:RLX) and Ceconomy (OTCMKTS:MTTRY) are both mid-cap consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, analyst recommendations, valuation, earnings and risk.

Earnings and Valuation

This table compares RLX Technology and Ceconomy”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RLX Technology	$3.27 billion	1.16	$75.60 million	$0.07	34.64
Ceconomy	$25.51 billion	0.10	-$38.73 million	$0.08	13.25

RLX Technology has higher earnings, but lower revenue than Ceconomy. Ceconomy is trading at a lower price-to-earnings ratio than RLX Technology, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares RLX Technology and Ceconomy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RLX Technology	21.05%	4.74%	4.44%
Ceconomy	0.71%	46.82%	2.53%

Analyst Ratings

This is a breakdown of current recommendations and price targets for RLX Technology and Ceconomy, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RLX Technology	0	2	0	0	2.00
Ceconomy	0	0	0	1	4.00

RLX Technology currently has a consensus target price of $2.25, suggesting a potential downside of 7.22%. Given RLX Technology’s higher probable upside, analysts plainly believe RLX Technology is more favorable than Ceconomy.

Insider and Institutional Ownership

22.7% of RLX Technology shares are owned by institutional investors. 53.4% of RLX Technology shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Volatility & Risk

RLX Technology has a beta of 1.1, indicating that its stock price is 10% more volatile than the S&P 500. Comparatively, Ceconomy has a beta of 1.32, indicating that its stock price is 32% more volatile than the S&P 500.

Summary

RLX Technology beats Ceconomy on 8 of the 14 factors compared between the two stocks.

About RLX Technology

RLX Technology Inc., together with its subsidiaries, engages in the manufacture and sale of e-vapor products in the People's Republic of China and internationally. It serves partner distributors and retail outlets. The company was founded in 2018 and is headquartered in Beijing, China.

About Ceconomy

Ceconomy AG, together with its subsidiaries, engages in the consumer electronics retail business. It operates stores under the MediaMarkt and Saturn brands. The company offers professional assistance for the installation, connection, and troubleshooting of electronic devices at home under the Deutsche Technikberatung brand. It operates in Germany, Austria, Switzerland, and Hungary, as well as in Western, Southern, and Eastern Europe. Ceconomy AG is based in Düsseldorf, Germany.