Advance Auto Parts (NYSE:AAP – Get Free Report) and Grabagun Digital (NYSE:PEW – Get Free Report) are both consumer discretionary companies, but which is the better business? We will compare the two businesses based on the strength of their risk, earnings, profitability, dividends, valuation, analyst recommendations and institutional ownership.
Risk & Volatility
Advance Auto Parts has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500. Comparatively, Grabagun Digital has a beta of -0.04, meaning that its stock price is 104% less volatile than the S&P 500.
Profitability
This table compares Advance Auto Parts and Grabagun Digital’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Advance Auto Parts | 0.97% | 9.84% | 1.83% |
| Grabagun Digital | -6.42% | -6.15% | -5.16% |
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Advance Auto Parts | 1 | 17 | 2 | 0 | 2.05 |
| Grabagun Digital | 1 | 0 | 1 | 0 | 2.00 |
Advance Auto Parts presently has a consensus target price of $48.94, indicating a potential upside of 15.22%. Grabagun Digital has a consensus target price of $5.00, indicating a potential upside of 162.47%. Given Grabagun Digital’s higher probable upside, analysts clearly believe Grabagun Digital is more favorable than Advance Auto Parts.
Earnings & Valuation
This table compares Advance Auto Parts and Grabagun Digital”s revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Advance Auto Parts | $8.60 billion | 0.30 | $44.00 million | $1.37 | 31.00 |
| Grabagun Digital | $96.45 million | 0.58 | -$2.51 million | ($0.23) | -8.28 |
Advance Auto Parts has higher revenue and earnings than Grabagun Digital. Grabagun Digital is trading at a lower price-to-earnings ratio than Advance Auto Parts, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
88.7% of Advance Auto Parts shares are held by institutional investors. Comparatively, 4.8% of Grabagun Digital shares are held by institutional investors. 0.8% of Advance Auto Parts shares are held by company insiders. Comparatively, 27.8% of Grabagun Digital shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.
Summary
Advance Auto Parts beats Grabagun Digital on 11 of the 14 factors compared between the two stocks.
About Advance Auto Parts
Advance Auto Parts, Inc. provides automotive replacement parts, accessories, batteries, and maintenance items for domestic and imported cars, vans, sport utility vehicles, and light and heavy duty trucks. The company offers battery accessories; belts and hoses; brakes and brake pads; chassis and climate control parts; clutches and drive shafts; engines and engine parts; exhaust systems and parts; hub assemblies; ignition components and wires; radiators and cooling parts; starters and alternators; and steering and alignment parts. It also offers air conditioning chemicals and accessories; air fresheners; antifreeze and washer fluids; electrical wires and fuses; electronics; floor mats, seat covers, and interior accessories; hand and specialty tools; lighting products; performance parts; sealants, adhesives, and compounds; tire repair accessories; vent shades, mirrors and exterior accessories; washes, waxes and cleaning supplies; and wiper blades. In addition, the company offers air filters; fuel and oil additives; fuel filters; grease and lubricants; motor oils; oil filters, part cleaners and treatments; and transmission fluids for engine maintenance. Further, it offers battery and wiper installation; engine light scanning and checking; electrical system testing, including batteries, starters, and alternators; oil and battery recycling; and loaner tool program services. Additionally, the company sells its products through its website. It serves professional installers and do-it-yourself customers. The company operates stores under the Advance Auto Parts and Carquest names, as well as branches under the Worldpac name. The company has stores in the United States, Puerto Rico, the U.S. Virgin Islands, and Canada; and independently owned Carquest branded stores in Mexico and various Caribbean Islands. Advance Auto Parts, Inc. was founded in 1929 and is based in Raleigh, North Carolina.
About Grabagun Digital
GrabAGun.com is an online retailer of firearms, ammunition and related accessories. GrabAGun.com, formerly known as Colombier Acquisition Corp. II, is based in COPPELL, Texas.
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