Analyzing Advantage Solutions (NASDAQ:ADV) and Pigeon (OTCMKTS:PGENY)

Advantage Solutions (NASDAQ:ADV) and Pigeon (OTCMKTS:PGENY) are both small-cap consumer discretionary companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, valuation, analyst recommendations, risk, profitability, institutional ownership and earnings.

Valuation & Earnings

This table compares Advantage Solutions and Pigeon”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Advantage Solutions	$3.57 billion	0.12	-$326.96 million	($1.16)	-1.17
Pigeon	$688.99 million	1.98	$55.26 million	$0.12	23.75

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

Risk and Volatility

Advantage Solutions has a beta of 2.04, meaning that its share price is 104% more volatile than the S&P 500. Comparatively, Pigeon has a beta of 0.15, meaning that its share price is 85% less volatile than the S&P 500.

Profitability

This table compares Advantage Solutions and Pigeon’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Advantage Solutions	-10.71%	-33.99%	-8.76%
Pigeon	8.33%	10.85%	8.49%

Insider & Institutional Ownership

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

Analyst Ratings

This is a summary of recent recommendations and price targets for Advantage Solutions and Pigeon, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Advantage Solutions	0	0	1	0	3.00
Pigeon	0	0	0	0	0.00

Advantage Solutions currently has a consensus price target of $2.25, indicating a potential upside of 65.44%. Given Advantage Solutions’ stronger consensus rating and higher possible upside, analysts clearly believe Advantage Solutions is more favorable than Pigeon.

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 Pigeon

Pigeon Corporation, together with its subsidiaries, engages in the manufacture, sale, import, and export of baby and child-care products, maternity items, women’s care products, home healthcare products, and nursing care products in Japan and internationally. The company operates in four segments: Japan Business, China Business, Singapore Business, and Lansinoh Business. The company is involved in the provision of baby and mother care products, such as nursing bottles and nipples, toiletries, breast pads, breast pumps, nipple care products, breast milk storage bags, and breastfeeding-related products under Pigeon and Lansinoh brands. It also offers non-woven products, baby strollers, aging-prevention products, wet wipes, skincare products, cleaning and disinfecting products, and elder care products and services. In addition, the company provides child-minding and daycare services, in-home nursing care support services, outpatient care facility services, operation of in-company childcare facilities, daycare services, event childcare services, babysitter dispatch services, preschool education services, and at-home elder care services. The company was formerly known as Pigeon Honyuki Honpo Corporation and changed its name to Pigeon Corporation in 1966. Pigeon Corporation was founded in 1949 and is headquartered in Tokyo, Japan.