Head-To-Head Survey: Arhaus (NASDAQ:ARHS) and ARKO (NASDAQ:ARKO)

ARKO (NASDAQ:ARKO) and Arhaus (NASDAQ:ARHS) are both small-cap consumer discretionary companies, but which is the superior business? We will contrast the two businesses based on the strength of their earnings, valuation, dividends, profitability, analyst recommendations, institutional ownership and risk.

Risk & Volatility

ARKO has a beta of 1, indicating that its stock price has a similar volatility profile to the S&P 500.Comparatively, Arhaus has a beta of 2.29, indicating that its stock price is 129% more volatile than the S&P 500.

Earnings & Valuation

This table compares ARKO and Arhaus”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ARKO	$7.64 billion	0.07	$22.74 million	$0.07	67.14
Arhaus	$1.38 billion	0.97	$67.26 million	$0.50	18.88

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

Profitability

This table compares ARKO and Arhaus’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ARKO	0.19%	4.44%	0.41%
Arhaus	4.91%	17.23%	4.94%

Analyst Recommendations

This is a breakdown of current ratings and price targets for ARKO and Arhaus, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ARKO	1	1	1	0	2.00
Arhaus	0	7	4	0	2.36

ARKO currently has a consensus target price of $14.50, indicating a potential upside of 208.51%. Arhaus has a consensus target price of $10.12, indicating a potential upside of 7.26%. Given ARKO’s higher possible upside, analysts clearly believe ARKO is more favorable than Arhaus.

Insider and Institutional Ownership

78.3% of ARKO shares are held by institutional investors. Comparatively, 27.9% of Arhaus shares are held by institutional investors. 21.9% of ARKO shares are held by insiders. Comparatively, 1.2% of Arhaus shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Summary

Arhaus beats ARKO on 9 of the 14 factors compared between the two stocks.

About ARKO

Arko Corp. operates convenience stores in the United States. It operates through Retail, Wholesale, Fleet Fueling, and GPMP segments. The Retail segment engages in the sale of fuel and merchandise to retail consumers. Its Wholesale segment supplies fuel to third-party dealers and consignment agents. The Fleet Fueling segment supplies fuel to proprietary and third-party cardlock, and issuance of proprietary fuel cards. Its GPMP segment supplies fuel to retail and wholesale segments. The company is based in Richmond, Virginia.

About Arhaus

Arhaus, Inc. operates as a lifestyle brand and premium retailer in the home furnishings market in the United States. It provides merchandise assortments across various categories, including furniture, lighting, textiles, décor, and outdoor. The company's furniture products comprise bedroom, dining room, living room, and home office furnishings, which includes sofas, dining tables and chairs, accent chairs, console and coffee tables, beds, headboards, dressers, desks, bookcases, modular storage, and other items; and outdoor products, such as outdoor dining tables, chairs, chaises and other furniture, lighting, textiles, décor, umbrellas, and fire pits. It offers lighting products, including various distinct and artistic lighting fixtures comprising chandeliers, pendants, table and floor lamps, and sconces; textile products, such as handcrafted indoor and outdoor rugs, bed linens, and pillows and throws; and décor products, including various wall art to mirrors, vases to candles, and other decorative accessories. The company distributes its products through an omni-channel model comprising showrooms, e-commerce platform, print and digital media, and in-home designer services. Arhaus, Inc. was founded in 1986 and is headquartered in Boston Heights, Ohio.