L’Oreal (OTCMKTS:LRLCY) versus ThredUp (NASDAQ:TDUP) Critical Analysis

ThredUp (NASDAQ:TDUP) and L’Oreal (OTCMKTS:LRLCY) are both consumer staples companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, valuation, risk, earnings and profitability.

Analyst Ratings

This is a summary of current ratings and recommmendations for ThredUp and L’Oreal, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ThredUp	1	1	2	2	2.83
L’Oreal	1	5	5	2	2.62

ThredUp presently has a consensus target price of $12.50, indicating a potential upside of 169.40%. Given ThredUp’s stronger consensus rating and higher possible upside, equities research analysts clearly believe ThredUp is more favorable than L’Oreal.

Profitability

This table compares ThredUp and L’Oreal’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ThredUp	-12.18%	-39.20%	-13.16%
L’Oreal	N/A	N/A	N/A

Institutional & Insider Ownership

89.1% of ThredUp shares are owned by institutional investors. Comparatively, 0.4% of L’Oreal shares are owned by institutional investors. 27.0% of ThredUp shares are owned 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.

Valuation and Earnings

This table compares ThredUp and L’Oreal”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ThredUp	$298.38 million	1.95	-$76.99 million	($0.30)	-15.47
L’Oreal	$49.83 billion	5.08	$6.93 billion	N/A	N/A

L’Oreal has higher revenue and earnings than ThredUp.

Risk & Volatility

ThredUp has a beta of 1.72, meaning that its share price is 72% more volatile than the S&P 500. Comparatively, L’Oreal has a beta of 0.9, meaning that its share price is 10% less volatile than the S&P 500.

Summary

L’Oreal beats ThredUp on 7 of the 12 factors compared between the two stocks.

About ThredUp

ThredUp Inc., together with its subsidiaries, operates an online resale platform in the United States and internationally. Its platform enables consumers to buy and sell primarily secondhand apparel, shoes, and accessories. ThredUp Inc. was incorporated in 2009 and is headquartered in Oakland, California.

About L’Oreal

L'Oréal S.A., through its subsidiaries, manufactures and sells cosmetic products for women and men worldwide. The company operates through four divisions: Consumer Products, L'oréal Luxe, Professional Products, and Dermatological Beauty. It offers skincare, make-up, hair colourants, haircare, perfumes, and hygiene products. The company provides its products under the L'Oréal Paris, Garnier, Maybelline New York, NYX Professional Makeup, Stylenanda, Essie, Dark & Lovely, Mixa, Magic Mask, Niley, Lancôme, Yves Saint Laurent, Armani, Kiehl's Since 1851, Helena Rubinstein, Biotherm, Shu Uemura, IT Cosmetics, Ralph Lauren Fragrance, Urban Decay, Mugler, Valentino, Viktor&Rolf, Azzaro, Prada, Cacharel, Maison Margela Fragrance, Diesel, Yue Sai, Atelier Colonge, Carita, Takami, Aesop, L'Oréal Professionnel Paris, Kérastase, Redken, Matrix, Pureology, Pulp Riot, La Roche-Posay, Vichy, CeraVe, SkinCeuticals, and Skinbetter Science brands. It sells its products through distribution channels, such as hair salons, local stores, e-commerce, travel retail, mass market retail, department store perfumeries, pharmacies, drug stores, medi-spas, and free-standing stores. L'Oréal S.A. was founded in 1909 and is headquartered in Clichy, France.