Advantage Solutions (NASDAQ:ADV) & ACV Auctions (NASDAQ:ACVA) Critical Survey

Advantage Solutions (NASDAQ:ADV) and ACV Auctions (NASDAQ:ACVA) are both consumer discretionary companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, dividends, earnings, risk, analyst recommendations, valuation and profitability.

Institutional and Insider Ownership

49.8% of Advantage Solutions shares are held by institutional investors. Comparatively, 88.6% of ACV Auctions shares are held by institutional investors. 6.2% of Advantage Solutions shares are held by insiders. Comparatively, 8.5% of ACV Auctions shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Advantage Solutions and ACV Auctions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Advantage Solutions	-3.32%	-7.58%	-2.17%
ACV Auctions	-12.51%	-12.94%	-5.75%

Earnings and Valuation

This table compares Advantage Solutions and ACV Auctions”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Advantage Solutions	$3.57 billion	0.12	-$63.26 million	($1.01)	-1.37
ACV Auctions	$637.16 million	4.04	-$79.70 million	($0.49)	-31.10

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

Analyst Ratings

This is a summary of current ratings and target prices for Advantage Solutions and ACV Auctions, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Advantage Solutions	0	0	1	0	3.00
ACV Auctions	0	2	9	0	2.82

Advantage Solutions presently has a consensus price target of $3.50, indicating a potential upside of 153.62%. ACV Auctions has a consensus price target of $22.50, indicating a potential upside of 47.64%. Given Advantage Solutions’ stronger consensus rating and higher probable upside, analysts clearly believe Advantage Solutions is more favorable than ACV Auctions.

Volatility and Risk

Advantage Solutions has a beta of 1.95, suggesting that its share price is 95% more volatile than the S&P 500. Comparatively, ACV Auctions has a beta of 1.74, suggesting that its share price is 74% more volatile than the S&P 500.

Summary

Advantage Solutions beats ACV Auctions on 9 of the 14 factors compared between the two stocks.

About Advantage Solutions

Advantage Solutions Inc. provides business solutions to consumer goods manufacturers and retailers in North America and internationally. It operates in two segments, Sales and Marketing. The Sales segment offers brand-centric services, such as headquarter relationship management; analytics, insights, and intelligence; and brand-centric merchandising services. This segment also provides retailer-centric services comprising retailer-centric merchandising and in-store media services. The Marketing segment offers brand-centric services, including shopper and consumer marketing, and brand experiential services; retailer-centric services, such as retail experiential and private label services; and digital marketing, and digital media and advertising services. The company was formerly known as Karman Holding Corp. and changed its name to Advantage Solutions Inc. in March 2016. The company was founded in 1987 and is headquartered in Irvine, California.

About ACV Auctions

ACV Auctions Inc. operates a digital marketplace that connects buyers and sellers for the online auction of wholesale vehicles. The company’s marketplace platform includes digital marketplace, which connects buyers and sellers by providing online auction, which facilitates real-time transactions of wholesale vehicles; Run List for pre-filtering and pre-screening of vehicles up to 24 hours prior to an auction taking place; ACV transportation service to enable the buyers to see real-time transportation quotes and status reports of the vehicle; ACV capital, a short-term inventory financing services for buyers to purchase vehicles; and Go Green’s seller assurance service for against claims related to defects in the vehicle. It also provides remarketing centers, which offers value-added services, such as vehicle reconditioning and storage for dealers and commercial partners. In addition, the company offers data services, including True360 report, which provides cosmetic and structural vehicle assessments integrated into vehicle history reports for dealer to make wholesale and retail transaction decisions on and off the marketplace; ACV market report provides transaction data and condition reports for comparable used vehicles, including pricing data from third-party sources and allows dealers to determine pricing and valuation strategies for used vehicles; and ACV MAX inventory management software enables dealers to manage their inventory and set pricing while turning vehicles. Further, it provides data and technology through inspection, such as condition reports, virtual lift solutions, apex device, and vehicle intelligence platform; and marketplace enablement, comprising MyACV application, private marketplaces, operations automation, live appraisals, and programmatic buying service. ACV Auctions Inc. was incorporated in 2014 and is headquartered in Buffalo, New York.