Critical Comparison: Whirlpool (NYSE:WHR) and Sonos (NASDAQ:SONO)

Sonos (NASDAQ:SONO) and Whirlpool (NYSE:WHR) are both consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their analyst recommendations, valuation, earnings, risk, dividends, institutional ownership and profitability.

Profitability

This table compares Sonos and Whirlpool’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sonos	3.82%	19.10%	8.67%
Whirlpool	1.17%	4.18%	0.82%

Institutional and Insider Ownership

85.8% of Sonos shares are owned by institutional investors. Comparatively, 90.8% of Whirlpool shares are owned by institutional investors. 1.3% of Sonos shares are owned by insiders. Comparatively, 2.0% of Whirlpool shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Sonos and Whirlpool”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sonos	$1.44 billion	1.24	-$61.14 million	$0.45	33.64
Whirlpool	$15.52 billion	0.16	$318.00 million	$2.92	13.04

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

Risk & Volatility

Sonos has a beta of 1.93, suggesting that its share price is 93% more volatile than the S&P 500. Comparatively, Whirlpool has a beta of 1.17, suggesting that its share price is 17% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent ratings for Sonos and Whirlpool, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sonos	0	3	2	0	2.40
Whirlpool	3	8	1	0	1.83

Sonos presently has a consensus price target of $20.00, suggesting a potential upside of 32.10%. Whirlpool has a consensus price target of $46.33, suggesting a potential upside of 21.71%. Given Sonos’ stronger consensus rating and higher probable upside, analysts clearly believe Sonos is more favorable than Whirlpool.

Summary

Sonos beats Whirlpool on 9 of the 14 factors compared between the two stocks.

About Sonos

Sonos, Inc., together with its subsidiaries, designs, develops, manufactures, and sells audio products and services in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. It offers wireless, portable, and home theater speakers; components; and accessories. The company offers its products through approximately 10,000 third-party retail stores, including custom installers of home audio systems; and e-commerce retailers, as well as through its website. The company was formerly known as Rincon Audio, Inc. and changed its name to Sonos, Inc. in May 2004. Sonos, Inc. was incorporated in 2002 and is headquartered in Santa Barbara, California.

About Whirlpool

Whirlpool Corporation manufactures and markets home appliances and related products and services in the North America, Europe, the Middle East, Africa, Latin America, and Asia. The company's principal products include refrigerators, freezers, ice makers, and refrigerator water filters; laundry appliances, and commercial laundry products and related laundry accessories; cooking and other small domestic appliances; and dishwasher appliances and related accessories, as well as mixers. It markets and distributes its products primarily under the Whirlpool, Maytag, KitchenAid, JennAir, Consul, Brastemp, Amana, Bauknecht, Hotpoint, Indesit, InSinkErator, Yummly, Affresh, Gladiator, Swash, everydrop, Ignis, Privileg, Eslabon de Lujo, and Acros brands. The company sells its products to retailers, distributors, dealers, builders, and other manufacturers, as well as directly to consumers. Whirlpool Corporation was founded in 1911 and is headquartered in Benton Harbor, Michigan.