Comparing Purple Innovation (NASDAQ:PRPL) and Cavco Industries (NASDAQ:CVCO)

Purple Innovation (NASDAQ:PRPL) and Cavco Industries (NASDAQ:CVCO) are both consumer discretionary companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, risk, earnings, profitability, analyst recommendations, dividends and valuation.

Profitability

This table compares Purple Innovation and Cavco Industries’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Purple Innovation	-10.74%	N/A	-10.89%
Cavco Industries	7.89%	16.51%	12.17%

Risk and Volatility

Purple Innovation has a beta of 1.4, indicating that its share price is 40% more volatile than the S&P 500. Comparatively, Cavco Industries has a beta of 1.28, indicating that its share price is 28% more volatile than the S&P 500.

Insider and Institutional Ownership

88.4% of Purple Innovation shares are held by institutional investors. Comparatively, 95.6% of Cavco Industries shares are held by institutional investors. 54.0% of Purple Innovation shares are held by company insiders. Comparatively, 1.7% of Cavco Industries shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of recent ratings for Purple Innovation and Cavco Industries, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Purple Innovation	1	2	0	0	1.67
Cavco Industries	1	2	1	1	2.40

Purple Innovation presently has a consensus target price of $16.25, suggesting a potential upside of 347.66%. Cavco Industries has a consensus target price of $700.00, suggesting a potential upside of 29.92%. Given Purple Innovation’s higher probable upside, analysts plainly believe Purple Innovation is more favorable than Cavco Industries.

Valuation and Earnings

This table compares Purple Innovation and Cavco Industries”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Purple Innovation	$468.73 million	0.03	-$51.41 million	($11.24)	-0.32
Cavco Industries	$2.24 billion	1.85	$190.55 million	$22.98	23.45

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

Summary

Cavco Industries beats Purple Innovation on 12 of the 15 factors compared between the two stocks.

About Purple Innovation

Purple Innovation, Inc. designs and manufactures sleep and other products in the United States and internationally. The company offers mattresses, pillows, cushions, bases, sheets, platforms, adjustable bases, mattress protectors, foundations, blankets, duvets, duvet covers, seat cushions, and pet beds under the Purple brand. It markets and sells its products through its e-commerce online channels, retail brick-and-mortar wholesale partners, third-party online retailers, and Purple showrooms, as well as through its website, Purple.com. The company was founded in 2010 and is headquartered in Lehi, Utah.

About Cavco Industries

Cavco Industries, Inc. designs, produces, and retails factory-built homes primarily in the United States. It operates in two segments, Factory-Built Housing and Financial Services. The company markets its factory-built homes under the Cavco, Fleetwood, Palm Harbor, Nationwide, Fairmont, Friendship, Chariot Eagle, Destiny, Commodore, Colony, Pennwest, R-Anell, Manorwood, MidCountry, and Solitaire brands. It produces park model RVs; vacation cabins; and factory-built commercial structures, including apartment buildings, condominiums, hotels, workforce housing, schools, and housing for the United States military troops. In addition, the company produces various modular homes, which include single and multi-section ranch, split-level, and Cape Cod style homes, as well as two- and three-story homes, and multi-family units. Further, it provides conforming and non-conforming mortgages and home-only loans to purchasers of various brands of factory-built homes sold by company-owned retail stores, as well as various independent distributors, builders, communities, and developers. Additionally, the company offers property and casualty insurance to owners of manufactured homes. It distributes its products through a network of independent and company-owned retailers, planned community operators, and residential developers. Cavco Industries, Inc. was founded in 1965 and is headquartered in Phoenix, Arizona.