Reviewing Children’s Place (NASDAQ:PLCE) and America’s Car-Mart (NASDAQ:CRMT)

America’s Car-Mart (NASDAQ:CRMT) and Children’s Place (NASDAQ:PLCE) are both small-cap consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, profitability, earnings, risk, institutional ownership and valuation.

Volatility & Risk

America’s Car-Mart has a beta of 1.27, suggesting that its share price is 27% more volatile than the S&P 500. Comparatively, Children’s Place has a beta of 1.97, suggesting that its share price is 97% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for America’s Car-Mart and Children’s Place, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
America’s Car-Mart	1	2	0	0	1.67
Children’s Place	1	1	0	0	1.50

America’s Car-Mart presently has a consensus price target of $14.00, indicating a potential upside of 631.07%. Children’s Place has a consensus price target of $3.25, indicating a potential upside of 33.20%. Given America’s Car-Mart’s stronger consensus rating and higher possible upside, analysts clearly believe America’s Car-Mart is more favorable than Children’s Place.

Valuation & Earnings

This table compares America’s Car-Mart and Children’s Place”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
America’s Car-Mart	$1.09 billion	0.02	-$139.11 million	($23.80)	-0.08
Children’s Place	$1.21 billion	0.04	-$88.26 million	($4.84)	-0.50

Children’s Place has higher revenue and earnings than America’s Car-Mart. Children’s Place is trading at a lower price-to-earnings ratio than America’s Car-Mart, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares America’s Car-Mart and Children’s Place’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
America’s Car-Mart	-18.21%	-15.19%	-4.73%
Children’s Place	-9.09%	N/A	-12.53%

Institutional & Insider Ownership

89.1% of America’s Car-Mart shares are held by institutional investors. 18.4% of America’s Car-Mart shares are held by insiders. Comparatively, 0.9% of Children’s Place shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Children’s Place beats America’s Car-Mart on 7 of the 13 factors compared between the two stocks.

About America’s Car-Mart

America’s Car-Mart, Inc., through its subsidiaries, operates as an automotive retailer for the used car market in the United States. It primarily sells older model used vehicles and provides financing for its customers. The company was founded in 1981 and is headquartered in Rogers, Arkansas.

About Children’s Place

The Children’s Place, Inc. engages in the provision of apparel, footwear, accessories, and other items for children. The firm also designs contracts to manufacture and sell fashionable and value-priced merchandise under the brand names of The Children’s Place, Baby Place, and Gymboree. It operates through The Children’s Place U.S. and The Children’s Place International segments. The Children’s Place U.S. segment refers to the company’s U.S. and Puerto Rico-based stores and revenue from its U.S. based wholesale business. The Children’s Place International segment is involved in the Canadian-based stores, revenue from the company’s Canadian-based wholesale business, as well as revenue from international franchisees. The company was founded by David Pulver and Clinton A. Clark in 1969 and is headquartered in Secaucus, NJ.