Head to Head Survey: LGI Homes (NASDAQ:LGIH) & Koss (NASDAQ:KOSS)

Koss (NASDAQ:KOSS) and LGI Homes (NASDAQ:LGIH) are both small-cap consumer discretionary companies, but which is the better business? We will contrast the two businesses based on the strength of their earnings, risk, valuation, profitability, analyst recommendations, institutional ownership and dividends.

Analyst Recommendations

This is a breakdown of current ratings and target prices for Koss and LGI Homes, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Koss	1	0	0	0	1.00
LGI Homes	2	1	2	0	2.00

LGI Homes has a consensus target price of $68.00, suggesting a potential upside of 63.95%. Given LGI Homes’ stronger consensus rating and higher possible upside, analysts plainly believe LGI Homes is more favorable than Koss.

Institutional & Insider Ownership

6.2% of Koss shares are owned by institutional investors. Comparatively, 84.9% of LGI Homes shares are owned by institutional investors. 44.1% of Koss shares are owned by company insiders. Comparatively, 12.6% of LGI Homes shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Volatility and Risk

Koss has a beta of 1.7, suggesting that its stock price is 70% more volatile than the S&P 500. Comparatively, LGI Homes has a beta of 1.88, suggesting that its stock price is 88% more volatile than the S&P 500.

Earnings and Valuation

This table compares Koss and LGI Homes”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Koss	$13.02 million	2.37	-$390,000.00	($0.09)	-36.27
LGI Homes	$1.71 billion	0.57	$72.55 million	$3.05	13.60

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

Profitability

This table compares Koss and LGI Homes’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Koss	-7.22%	-2.90%	-2.39%
LGI Homes	4.05%	3.75%	2.02%

Summary

LGI Homes beats Koss on 12 of the 14 factors compared between the two stocks.

About Koss

Koss Corporation (NASDAQ: KOSS) is an American audio equipment company headquartered in Milwaukee, Wisconsin. The company designs, manufactures and sells headphones and related personal audio products for consumers and professional users. Koss’s product portfolio includes wired stereo headphones, wireless and Bluetooth headphones, true wireless earbuds, communication headsets and accessories. Its products are sold through retailers, distributors and online channels under the Koss brand. The company was founded in 1953 by John C. Koss and introduced one of the first high-fidelity stereo headphones, the SP/3, in 1958.

About LGI Homes

LGI Homes, Inc. is a residential homebuilder headquartered in The Woodlands, Texas. Founded in 2003, the company develops and sells newly built homes, including single-family houses and townhomes, in planned communities. Its homes are marketed to a range of buyers, including first-time buyers and households seeking larger homes. The company operates under the LGI Homes and Terrata Homes brands, offering homes across markets in multiple U.S. states. Its communities feature a variety of home designs and locations, with offerings that vary by market.