America’s Car-Mart (NASDAQ:CRMT – Get Free Report) and Titan Machinery (NASDAQ:TITN – Get Free Report) are both small-cap retail/wholesale companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, analyst recommendations, dividends, institutional ownership and profitability.
Insider & Institutional Ownership
89.1% of America’s Car-Mart shares are held by institutional investors. Comparatively, 78.4% of Titan Machinery shares are held by institutional investors. 19.6% of America’s Car-Mart shares are held by insiders. Comparatively, 10.8% of Titan Machinery shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.
Risk and Volatility
America’s Car-Mart has a beta of 1.35, meaning that its share price is 35% more volatile than the S&P 500. Comparatively, Titan Machinery has a beta of 1.35, meaning that its share price is 35% more volatile than the S&P 500.
Analyst Ratings
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| America’s Car-Mart | 0 | 0 | 0 | 1 | 4.00 |
| Titan Machinery | 0 | 2 | 3 | 2 | 3.00 |
America’s Car-Mart presently has a consensus price target of $50.00, suggesting a potential downside of 17.19%. Titan Machinery has a consensus price target of $21.00, suggesting a potential upside of 7.42%. Given Titan Machinery’s higher possible upside, analysts clearly believe Titan Machinery is more favorable than America’s Car-Mart.
Profitability
This table compares America’s Car-Mart and Titan Machinery’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| America’s Car-Mart | 1.29% | 2.01% | 0.68% |
| Titan Machinery | -2.23% | -8.22% | -2.64% |
Valuation & Earnings
This table compares America’s Car-Mart and Titan Machinery”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| America’s Car-Mart | $1.39 billion | 0.36 | $17.93 million | $2.09 | 28.89 |
| Titan Machinery | $2.70 billion | 0.17 | -$36.91 million | ($2.63) | -7.43 |
America’s Car-Mart has higher earnings, but lower revenue than Titan Machinery. Titan Machinery is trading at a lower price-to-earnings ratio than America’s Car-Mart, indicating that it is currently the more affordable of the two stocks.
Summary
America’s Car-Mart beats Titan Machinery on 10 of the 14 factors compared between the two stocks.
About America’s Car-Mart
America’s Car-Mart, Inc., through its subsidiaries, operates as an automotive retailer for the used car market in the United States. It primarily sells older model used vehicles and provides financing for its customers. The company was founded in 1981 and is headquartered in Rogers, Arkansas.
About Titan Machinery
Titan Machinery Inc. owns and operates a network of full service agricultural and construction equipment stores in the United States, Europe, and Australia. It operates through four segments: Agriculture, Construction, Europe, and Australia. The company sells new and used equipment, including agricultural and construction equipment manufactured under the CNH Industrial family of brands, as well as equipment from various other manufacturers. Its agricultural equipment includes machinery and attachments for use in the production of food, fiber, feed grain, feed stock, and renewable energy; and home and garden applications, as well as maintenance of commercial, residential, and government properties. The company’s construction equipment comprises heavy construction machinery, light industrial machinery for commercial and residential construction, and road and highway construction machinery. It also sells maintenance and replacement parts. In addition, the company offers repair and maintenance services that include warranty repairs, off-site and on-site repair services, scheduling off-season maintenance services, and notifying customers of periodic service requirements; and training programs to customers. Further, it rents equipment; and provides ancillary equipment support services, such as equipment transportation, global positioning system signal subscriptions and other precision farming products, farm data management products, and CNH Industrial finance and insurance products. The company operates in Colorado, Idaho, Kansas, Missouri, Washington, Iowa, Minnesota, Montana, Nebraska, North Dakota, South Dakota, Wisconsin, and Wyoming, the United States; Bulgaria, Germany, Romania, and Ukraine, Europe; and New South Wales, South Australia, and Victoria, Australia. Titan Machinery Inc. was founded in 1980 and is headquartered in West Fargo, North Dakota.
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