Contrasting Dorel Industries (OTCMKTS:DIIBF) & Purple Innovation (NASDAQ:PRPL)

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

Insider and Institutional Ownership

88.4% of Purple Innovation shares are owned by institutional investors. 54.0% of Purple Innovation shares are owned by insiders. Comparatively, 19.3% of Dorel Industries shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Purple Innovation and Dorel Industries, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Purple Innovation	1	2	0	0	1.67
Dorel Industries	0	1	0	0	2.00

Purple Innovation currently has a consensus price target of $16.25, suggesting a potential upside of 191.22%. Given Purple Innovation’s higher probable upside, analysts clearly believe Purple Innovation is more favorable than Dorel Industries.

Risk & Volatility

Purple Innovation has a beta of 1.46, suggesting that its stock price is 46% more volatile than the S&P 500. Comparatively, Dorel Industries has a beta of 1.58, suggesting that its stock price is 58% more volatile than the S&P 500.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Purple Innovation	$453.45 million	0.05	-$51.41 million	($11.24)	-0.50
Dorel Industries	$1.19 billion	0.03	-$142.22 million	($4.16)	-0.29

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

Profitability

This table compares Purple Innovation and Dorel 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%
Dorel Industries	-12.73%	N/A	-11.58%

Summary

Purple Innovation beats Dorel Industries on 7 of the 12 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 Dorel Industries

Dorel Industries Inc. engages in the design, manufacture, sourcing, marketing, and distribution of home and juvenile products worldwide. The company operates through Dorel Home and Dorel Juvenile segments. The Dorel Home segment offers ready-to assemble furniture and home furnishings products, including metal folding furniture, futons, children's furniture, step stools, hand trucks, ladders, outdoor furniture, and other imported furniture items. This segment markets its products under the DHP, Signature Sleep, Little Seeds, Ameriwood Home, Cosco Home & Office, Queer Eye, Cosmo Living, Novogratz, Real Rooms, Mr. Kate, Baby Relax, Alphason, Bertini, Ntense, and Notio brands. The Dorel Juvenile segment provides children's accessories comprising infant car seats, strollers, home equipment, toys, infant health, and safety aids under the Maxi-Cosi, Tiny Love, Infanti, Safety 1st, Bébé Confort, Quinny, and Cosco brands. The company was formerly known as Dorel Co. Ltd. and changed its name to Dorel Industries Inc. in May 1987. Dorel Industries Inc. was incorporated in 1962 and is headquartered in Westmount, Canada.