Comparing Groupon (NASDAQ:GRPN) and Seven and I (OTCMKTS:SVNDY)

Seven and I (OTCMKTS:SVNDY) and Groupon (NASDAQ:GRPN) are both consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, earnings, valuation, dividends, profitability, risk and analyst recommendations.

Institutional and Insider Ownership

0.0% of Seven and I shares are owned by institutional investors. Comparatively, 90.0% of Groupon shares are owned by institutional investors. 36.6% of Groupon 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.

Profitability

This table compares Seven and I and Groupon’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Seven and I	2.89%	8.20%	3.23%
Groupon	-1.67%	N/A	-1.36%

Earnings & Valuation

This table compares Seven and I and Groupon”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Seven and I	$69.63 billion	0.44	$1.96 billion	$0.80	16.66
Groupon	$498.42 million	1.03	-$83.52 million	($3.11)	-4.12

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

Risk and Volatility

Seven and I has a beta of 0.36, indicating that its share price is 64% less volatile than the S&P 500. Comparatively, Groupon has a beta of 0.29, indicating that its share price is 71% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations for Seven and I and Groupon, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Seven and I	0	2	0	0	2.00
Groupon	2	0	1	0	1.67

Groupon has a consensus price target of $23.00, suggesting a potential upside of 79.41%. Given Groupon’s higher probable upside, analysts plainly believe Groupon is more favorable than Seven and I.

Summary

Seven and I beats Groupon on 9 of the 14 factors compared between the two stocks.

About Seven and I

Seven & i Holdings is a Japan-based retail group whose businesses include convenience stores, supermarkets and other retail operations. Its best-known brand is 7-Eleven, which serves customers through stores in Japan, North America and other international markets. The company’s retail offerings include food, beverages, household goods and everyday services. The group also operates businesses in Japan under brands including Ito-Yokado, a general merchandise and supermarket retailer. Its activities have included financial services and other customer-focused services alongside retailing.

About Groupon

Groupon, Inc. operates an online marketplace that connects consumers with local businesses. Through its website and mobile app, customers can discover and purchase offers on services and experiences such as dining, wellness, entertainment and activities. The company also provides merchants with a platform to promote their offerings and reach potential customers. Groupon has operated in North America and international markets, though the availability of its services and offers varies by location.