Critical Review: ACV Auctions (NASDAQ:ACVA) versus Generation Hemp (OTCMKTS:GENH)

ACV Auctions (NASDAQ:ACVA) and Generation Hemp (OTCMKTS:GENH) are both small-cap retail/wholesale companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, risk, earnings, profitability, valuation and dividends.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for ACV Auctions and Generation Hemp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ACV Auctions	0	2	10	0	2.83
Generation Hemp	0	0	0	0	0.00

ACV Auctions presently has a consensus price target of $19.6667, suggesting a potential upside of 69.76%. Given ACV Auctions’ stronger consensus rating and higher probable upside, equities analysts clearly believe ACV Auctions is more favorable than Generation Hemp.

Earnings & Valuation

This table compares ACV Auctions and Generation Hemp”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ACV Auctions	$707.24 million	2.80	-$79.70 million	($0.39)	-29.71
Generation Hemp	$680,000.00	36.83	-$9.82 million	N/A	N/A

Generation Hemp has lower revenue, but higher earnings than ACV Auctions.

Institutional & Insider Ownership

88.6% of ACV Auctions shares are held by institutional investors. 2.9% of ACV Auctions shares are held by insiders. Comparatively, 60.9% of Generation Hemp 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.

Profitability

This table compares ACV Auctions and Generation Hemp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ACV Auctions	-12.51%	-12.94%	-5.75%
Generation Hemp	-674.14%	-15,656.36%	-195.12%

Risk and Volatility

ACV Auctions has a beta of 1.69, meaning that its share price is 69% more volatile than the S&P 500. Comparatively, Generation Hemp has a beta of -0.38, meaning that its share price is 138% less volatile than the S&P 500.

Summary

ACV Auctions beats Generation Hemp on 9 of the 12 factors compared between the two stocks.

About ACV Auctions

ACV Auctions Inc. operates a digital marketplace that connects buyers and sellers for the online auction of wholesale vehicles. The company’s marketplace platform includes digital marketplace, which connects buyers and sellers by providing online auction, which facilitates real-time transactions of wholesale vehicles; Run List for pre-filtering and pre-screening of vehicles up to 24 hours prior to an auction taking place; ACV transportation service to enable the buyers to see real-time transportation quotes and status reports of the vehicle; ACV capital, a short-term inventory financing services for buyers to purchase vehicles; and Go Green’s seller assurance service for against claims related to defects in the vehicle. It also provides remarketing centers, which offers value-added services, such as vehicle reconditioning and storage for dealers and commercial partners. In addition, the company offers data services, including True360 report, which provides cosmetic and structural vehicle assessments integrated into vehicle history reports for dealer to make wholesale and retail transaction decisions on and off the marketplace; ACV market report provides transaction data and condition reports for comparable used vehicles, including pricing data from third-party sources and allows dealers to determine pricing and valuation strategies for used vehicles; and ACV MAX inventory management software enables dealers to manage their inventory and set pricing while turning vehicles. Further, it provides data and technology through inspection, such as condition reports, virtual lift solutions, apex device, and vehicle intelligence platform; and marketplace enablement, comprising MyACV application, private marketplaces, operations automation, live appraisals, and programmatic buying service. ACV Auctions Inc. was incorporated in 2014 and is headquartered in Buffalo, New York.

About Generation Hemp

Evergreen Sustainable Enterprises, Inc. operates as a hemp company. It engages in leases warehouse space to hemp seed growers. The company was founded on July 28, 2008 and is headquartered in Dallas, TX.