Smith & Wesson Brands (NASDAQ:SWBI – Get Free Report) and Funko (NASDAQ:FNKO – Get Free Report) 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 profitability, analyst recommendations, institutional ownership, risk, earnings, dividends and valuation.
Analyst Ratings
This is a breakdown of recent ratings and recommmendations for Smith & Wesson Brands and Funko, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Smith & Wesson Brands | 0 | 2 | 1 | 0 | 2.33 |
| Funko | 1 | 2 | 1 | 0 | 2.00 |
Smith & Wesson Brands currently has a consensus price target of $16.50, suggesting a potential upside of 14.03%. Funko has a consensus price target of $7.08, suggesting a potential upside of 5.41%. Given Smith & Wesson Brands’ stronger consensus rating and higher possible upside, analysts plainly believe Smith & Wesson Brands is more favorable than Funko.
Earnings and Valuation
This table compares Smith & Wesson Brands and Funko”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Smith & Wesson Brands | $523.84 million | 1.24 | $18.48 million | $0.54 | 26.80 |
| Funko | $932.64 million | 0.40 | -$67.36 million | $0.07 | 96.00 |
Smith & Wesson Brands has higher earnings, but lower revenue than Funko. Smith & Wesson Brands is trading at a lower price-to-earnings ratio than Funko, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
59.3% of Smith & Wesson Brands shares are owned by institutional investors. Comparatively, 99.2% of Funko shares are owned by institutional investors. 2.3% of Smith & Wesson Brands shares are owned by company insiders. Comparatively, 3.9% of Funko shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
Risk and Volatility
Smith & Wesson Brands has a beta of 0.81, suggesting that its share price is 19% less volatile than the S&P 500. Comparatively, Funko has a beta of 1, suggesting that its share price has a similar volatility profile to the S&P 500.
Profitability
This table compares Smith & Wesson Brands and Funko’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Smith & Wesson Brands | 4.44% | 6.60% | 4.59% |
| Funko | 0.49% | 6.63% | 1.83% |
Summary
Smith & Wesson Brands beats Funko on 7 of the 13 factors compared between the two stocks.
About Smith & Wesson Brands
Smith & Wesson Brands, Inc. is a holding company, which engages in the manufacture, design, and provision of firearms. Its portfolio includes handguns, long guns, handcuffs, suppressor, and other firearm-related products. The firm’s brands are Smith & Wesson, M&P, Thompson/Center Arms, and Gemtech. The company was founded by Horace Smith and Daniel Baird Wesson in 1852 and is headquartered in Maryville, TN.
About Funko
Funko, Inc., a pop culture consumer products company, designs, sources, and distributes licensed pop culture products in the United States, Europe, and internationally. The company provides media and entertainment content, including movies, television (TV) shows, video games, music, and sports; figures, handbags, backpacks, wallets, apparel, accessories, plush products, homewares, and digital non-fungible tokens; and art prints and vinyl records, posters, soundtracks, toys, books, games, and other collectibles. It markets its products under the Pop!, Loungefly, Funko, Mystery Minis, Bitty Pop!, Funko action figures, Funko Plush, and Funko Soda brand names; and licenses its properties under the classic evergreen, movie release, current TV, and current video game categories. The company sells its products through specialty retailers, mass-market retailers, e-commerce sites, and distributors; and at specialty licensing and comic book shows, conventions, and exhibitions, as well as through its e-commerce business. Funko, Inc. was incorporated in 2017 and is headquartered in Everett, Washington.
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