Netshoes (CAYMAN) (NYSE: NETS) and PC Connection (NASDAQ:CNXN) are both small-cap consumer discretionary companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, profitability, earnings, analyst recommendations, institutional ownership, dividends and valuation.

Analyst Recommendations

This is a summary of current recommendations and price targets for Netshoes (CAYMAN) and PC Connection, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Netshoes (CAYMAN) 1 2 0 0 1.67
PC Connection 0 1 1 0 2.50

PC Connection has a consensus price target of $40.00, indicating a potential upside of 6.95%. Given PC Connection’s stronger consensus rating and higher probable upside, analysts clearly believe PC Connection is more favorable than Netshoes (CAYMAN).

Risk & Volatility

Netshoes (CAYMAN) has a beta of 1.55, suggesting that its share price is 55% more volatile than the S&P 500. Comparatively, PC Connection has a beta of 1.35, suggesting that its share price is 35% more volatile than the S&P 500.

Earnings & Valuation

This table compares Netshoes (CAYMAN) and PC Connection’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Netshoes (CAYMAN) $180.65 million 0.55 -$51.31 million ($1.80) -1.78
PC Connection $2.91 billion 0.34 $54.85 million $1.84 20.33

PC Connection has higher revenue and earnings than Netshoes (CAYMAN). Netshoes (CAYMAN) is trading at a lower price-to-earnings ratio than PC Connection, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

60.3% of Netshoes (CAYMAN) shares are held by institutional investors. Comparatively, 40.7% of PC Connection shares are held by institutional investors. 57.1% of PC Connection shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Netshoes (CAYMAN) and PC Connection’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Netshoes (CAYMAN) -10.20% -36.94% -13.62%
PC Connection 2.24% 11.73% 7.83%

Summary

PC Connection beats Netshoes (CAYMAN) on 10 of the 13 factors compared between the two stocks.

About Netshoes (CAYMAN)

Netshoes (Cayman) Limited, through its subsidiaries, operates as a sports and lifestyle online retailer in Brazil and internationally. It offers various products, including athletic shoes, jerseys, apparels, accessories, and sporting equipment of international, local, and private brands, as well as fashion primarily under the Netshoes and Zattini brands. The company operates through its e-commerce Websites, such as netshoes.com, shoestock.com, and zattini.com. Netshoes (Cayman) Limited was incorporated in 2000 and is headquartered in São Paulo, Brazil.

About PC Connection

PC Connection, Inc., together with its subsidiaries, provides a range of information technology (IT) solutions. The company operates through three segments: Business Solutions, Enterprise Solutions, and Public Sector Solutions. It offers IT products, such as computer systems, software and peripheral equipment, networking communications, and other products and accessories. The company also provides services comprising design, configuration, and implementation of IT solutions. In addition, publishes Connected, a quarterly publication that provides informative articles on the latest technologies and industry trends; distributes specialty catalogs to education, healthcare, and government customers; and MacConnection that publishes a catalog for the Apple market. The company markets its products and services through its Websites, such as connection.com, connection.com/enterprise, connection.com/publicsector, and macconnection.com. It serves small to medium-sized businesses (SMBs) comprising small office/home offices customers; government and educational institutions; and medium-to-large corporate accounts through outbound telemarketing and field sales and marketing programs targeted to specific customer populations, as well as through digital, Web, and print media advertising. PC Connection, Inc. was founded in 1982 and is headquartered in Merrimack, New Hampshire.

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