Critical Analysis: NVR (NYSE:NVR) vs. Koss (NASDAQ:KOSS)

Koss (NASDAQ:KOSS) and NVR (NYSE:NVR) are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, dividends, analyst recommendations, institutional ownership and profitability.

Analyst Ratings

This is a summary of current ratings and recommmendations for Koss and NVR, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Koss	1	0	0	0	1.00
NVR	2	3	3	0	2.12

NVR has a consensus price target of $6,809.67, indicating a potential upside of 13.45%. Given NVR’s stronger consensus rating and higher possible upside, analysts plainly believe NVR is more favorable than Koss.

Valuation and Earnings

This table compares Koss and NVR”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Koss	$13.02 million	2.68	-$390,000.00	($0.04)	-92.25
NVR	$9.55 billion	1.68	$1.34 billion	$385.59	15.57

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

Profitability

This table compares Koss and NVR’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Koss	-3.00%	-1.29%	-1.06%
NVR	12.26%	31.02%	19.89%

Risk & Volatility

Koss has a beta of 1.63, meaning that its stock price is 63% more volatile than the S&P 500. Comparatively, NVR has a beta of 0.9, meaning that its stock price is 10% less volatile than the S&P 500.

Institutional & Insider Ownership

6.2% of Koss shares are held by institutional investors. Comparatively, 83.7% of NVR shares are held by institutional investors. 44.1% of Koss shares are held by insiders. Comparatively, 8.6% of NVR shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Summary

NVR beats Koss on 11 of the 14 factors compared between the two stocks.

About Koss

Koss Corporation, together with its subsidiaries, engages in the design, manufacture, and sale of stereo headphones and related accessories in the United States, the Czech Republic, Sweden, Canada, Korea, Republic of Belgium, Malaysia, and internationally. It offers high-fidelity headphones, wireless bluetooth headphones, wireless bluetooth speakers, computer headsets, telecommunications headsets, and active noise canceling headphones. The company sells its products through distributors, international distributors, audio specialty stores, the internet, national retailers, grocery stores, electronics retailers, and prisons under the Koss name, as well as private label. It sells its products to distributors for resale to school systems, as well as directly to other manufacturers. The company markets through domestic retail outlets and numerous retailers. It exports its products. Koss Corporation was founded in 1953 and is headquartered in Milwaukee, Wisconsin.

About NVR

NVR, Inc. operates as a homebuilder in the United States. The company operates through, Homebuilding and Mortgage Banking segments. It engages in the construction and sale of single-family detached homes, townhomes, and condominium buildings under the Ryan Homes, NVHomes, and Heartland Homes names. The company markets its Ryan Homes products to first-time and first-time move-up buyers; and NVHomes and Heartland Homes products to move-up and luxury buyers. It also provides various mortgage related services to its homebuilding customers, as well as brokers title insurance; performs title searches in connection with mortgage loan closings; and sells mortgage loans to investors in the secondary markets on a servicing released basis. The company primarily serves in Maryland, Virginia, West Virginia, Delaware, New Jersey, Eastern Pennsylvania, New York, Ohio, Western Pennsylvania, Indiana, Illinois, North Carolina, Georgia, South Carolina, Florida, Tennessee, and Washington, D.C. NVR, Inc. was founded in 1980 and is headquartered in Reston, Virginia.