Reviewing Japan Tob (OTCMKTS:JAPAY) & ATA (NASDAQ:AACG)

Japan Tob (OTCMKTS:JAPAY) and ATA (NASDAQ:AACG) are both consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, analyst recommendations, profitability, earnings, dividends and valuation.

Valuation & Earnings

This table compares Japan Tob and ATA”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Japan Tob	$23.20 billion	3.62	$3.42 billion	$1.37	17.25
ATA	$38.34 million	0.54	-$6.87 million	($0.20)	-3.05

Japan Tob has higher revenue and earnings than ATA. ATA is trading at a lower price-to-earnings ratio than Japan Tob, indicating that it is currently the more affordable of the two stocks.

Volatility and Risk

Japan Tob has a beta of 0.28, indicating that its stock price is 72% less volatile than the S&P 500. Comparatively, ATA has a beta of 1.18, indicating that its stock price is 18% more volatile than the S&P 500.

Insider and Institutional Ownership

0.7% of ATA shares are owned by institutional investors. 52.9% of ATA shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Japan Tob and ATA’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Japan Tob	N/A	N/A	N/A
ATA	N/A	N/A	N/A

Analyst Ratings

This is a breakdown of recent ratings and price targets for Japan Tob and ATA, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Japan Tob	1	0	1	1	2.67
ATA	1	0	0	0	1.00

Japan Tob currently has a consensus target price of $17.00, indicating a potential downside of 28.06%. Given Japan Tob’s stronger consensus rating and higher possible upside, analysts clearly believe Japan Tob is more favorable than ATA.

Summary

Japan Tob beats ATA on 9 of the 12 factors compared between the two stocks.

About Japan Tob

Japan Tobacco Inc., a tobacco company, manufactures and sells tobacco products, pharmaceuticals, and processed foods in Japan and internationally. The company operates through three segments: Tobacco Business, Pharmaceutical, and Processed Food. It offers tobacco products, such as cigarettes, heat-not-burn tobacco products, E-vapor products, fine cut tobacco products, cigars, pipes, smokeless tobacco products, and hookah and kretek products. The company also provides reduced-risk products, including infused tobacco capsules and heated tobacco sticks. In addition, it researches and develops, manufactures, and sells prescription drugs for the therapeutic areas, such as cardiovascular, kidney and metabolism, immunity/inflammation, and central nervous system. Further, the company provides frozen and room-temperature products, such as frozen udon noodles, packed rice, and frozen okonomiyaki; bakery products; and seasonings, including yeast extracts, assembled, kelp and bonito extracts, and oyster sauces. It offers its products under the Winston, Camel, MEVIUS, and LD brands. Japan Tobacco Inc. was incorporated in 1985 and is headquartered in Tokyo, Japan.

About ATA

ATA Creativity Global, together with its subsidiaries, provides educational services to individual students through its training center network in China and internationally. Its educational services include portfolio training, research-based learning, overseas study counselling, in-school art classes through cooperation with high schools and training organizations, foreign language training services, junior art education, and other related educational services to its students. The company also offers online courses for students. It provides its services through partnership with sales channels, internet and mobile advertisement, word of mouth referral, and marketing events and activities. The company was formerly known as ATA Inc. and changed its name to ATA Creativity Global in September 2019. ATA Creativity Global was founded in 1999 and is headquartered in Hefei, China.