Critical Contrast: Sonder (NASDAQ:SOND) versus Norwegian Cruise Line (NYSE:NCLH)

Norwegian Cruise Line (NYSE:NCLH) and Sonder (NASDAQ:SOND) are both consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, earnings, valuation, risk, profitability and dividends.

Volatility and Risk

Norwegian Cruise Line has a beta of 2.22, indicating that its share price is 122% more volatile than the S&P 500. Comparatively, Sonder has a beta of 1.72, indicating that its share price is 72% more volatile than the S&P 500.

Earnings and Valuation

This table compares Norwegian Cruise Line and Sonder”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Norwegian Cruise Line	$9.69 billion	0.88	$910.26 million	$1.36	13.90
Sonder	$621.27 million	0.01	-$224.09 million	($22.08)	-0.02

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

Insider and Institutional Ownership

69.6% of Norwegian Cruise Line shares are held by institutional investors. Comparatively, 45.9% of Sonder shares are held by institutional investors. 0.4% of Norwegian Cruise Line shares are held by insiders. Comparatively, 3.8% of Sonder shares are held by 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.

Profitability

This table compares Norwegian Cruise Line and Sonder’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Norwegian Cruise Line	7.52%	59.88%	4.02%
Sonder	-42.27%	N/A	-22.67%

Analyst Ratings

This is a breakdown of recent ratings and target prices for Norwegian Cruise Line and Sonder, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Norwegian Cruise Line	0	8	12	3	2.78
Sonder	1	0	0	0	1.00

Norwegian Cruise Line presently has a consensus price target of $28.74, indicating a potential upside of 52.05%. Given Norwegian Cruise Line’s stronger consensus rating and higher probable upside, equities analysts plainly believe Norwegian Cruise Line is more favorable than Sonder.

Summary

Norwegian Cruise Line beats Sonder on 14 of the 15 factors compared between the two stocks.

About Norwegian Cruise Line

Norwegian Cruise Line Holdings Ltd., together with its subsidiaries, operates as a cruise company in North America, Europe, the Asia-Pacific, and internationally. The company operates through the Norwegian Cruise Line, Oceania Cruises, and Regent Seven Seas Cruises brands. It offers itineraries ranging from three days to a 180-days calling on various ports, including Scandinavia, Northern Europe, the Mediterranean, the Greek Isles, Alaska, Canada and New England, Hawaii, Asia, Tahiti and the South Pacific, Australia and New Zealand, Africa, India, South America, the Panama Canal, and the Caribbean. It distributes its products through retail/travel advisor and onboard cruise sales channels, as well as meetings, incentives, and charters. Norwegian Cruise Line Holdings Ltd. was founded in 1966 and is based in Miami, Florida.

About Sonder

Sonder Holdings Inc. engages in the hospitality business. It operates and manages properties comprising 1-, 2-, and 3+ bedroom; and studio apartments, as well as 1-bedroom hotel rooms for leisure travelers and families, digital nomads, and business travelers in North America, Europe, and the Middle East. The company is headquartered in San Francisco, California.