Financial Analysis: Driven Brands (NASDAQ:DRVN) and Genuine Parts (NYSE:GPC)

Driven Brands (NASDAQ:DRVN) and Genuine Parts (NYSE:GPC) are both retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, analyst recommendations, institutional ownership, risk, profitability, earnings and valuation.

Volatility & Risk

Driven Brands has a beta of 1.08, meaning that its share price is 8% more volatile than the S&P 500. Comparatively, Genuine Parts has a beta of 0.75, meaning that its share price is 25% less volatile than the S&P 500.

Insider and Institutional Ownership

77.1% of Driven Brands shares are held by institutional investors. Comparatively, 78.8% of Genuine Parts shares are held by institutional investors. 3.5% of Driven Brands shares are held by company insiders. Comparatively, 0.4% of Genuine Parts shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for Driven Brands and Genuine Parts, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Driven Brands	0	2	7	0	2.78
Genuine Parts	1	4	4	1	2.50

Driven Brands currently has a consensus price target of $21.60, indicating a potential upside of 30.28%. Genuine Parts has a consensus price target of $135.2857, indicating a potential upside of 1.65%. Given Driven Brands’ stronger consensus rating and higher possible upside, equities analysts clearly believe Driven Brands is more favorable than Genuine Parts.

Valuation & Earnings

This table compares Driven Brands and Genuine Parts”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Driven Brands	$2.34 billion	1.16	-$292.50 million	($1.70)	-9.75
Genuine Parts	$23.49 billion	0.79	$904.08 million	$5.81	22.91

Genuine Parts has higher revenue and earnings than Driven Brands. Driven Brands is trading at a lower price-to-earnings ratio than Genuine Parts, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Driven Brands and Genuine Parts’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Driven Brands	-12.32%	21.21%	2.88%
Genuine Parts	3.40%	22.41%	5.12%

Summary

Genuine Parts beats Driven Brands on 9 of the 15 factors compared between the two stocks.

About Driven Brands

Driven Brands Holdings Inc., together with its subsidiaries, provides automotive services to retail and commercial customers in the United States, Canada, and internationally. It offers various services, such as paint, collision, glass, repair, car wash, oil change, and maintenance services. The company also distributes automotive parts, including radiators, air conditioning components, and exhaust products to automotive repair shops, auto parts stores, body shops, and other auto repair outlets; windshields and glass accessories through a network of distribution centers; and consumable products, such as oil filters and wiper blades, as well as training services to repair and maintenance, and paint and collision shops. It sells its products and services under the CARSTAR, IMO, MAACO, Meineke Car Care Centers, PH Vitres D’Autos, Take 5 Oil Change, Take 5 Car Wash, Auto Glass Now, Fix Auto USA, and 1-800-Radiator & A/C, Spire Supply, and Automotive Training Institute brands. The company was founded in 1972 and is headquartered in Charlotte, North Carolina.

About Genuine Parts

Genuine Parts Company distributes automotive replacement parts, and industrial parts and materials. It operates in two segments: Automotive Parts Group and Industrial Parts Group segments. The company distributes automotive replacement parts for hybrid and electric vehicles, trucks, SUVs, buses, motorcycles, recreational vehicles, farm vehicles, small engines, farm equipment, marine equipment, and heavy duty equipment; and equipment and parts used by repair shops, service stations, fleet operators, automobile and truck dealers, leasing companies, bus and truck lines, mass merchandisers, farms, and individuals. It also distributes industrial replacement parts and related supplies, such as abrasives, adhesives, sealants and tape, bearings, chemicals, cutting tools, electrical, facility maintenance, hose and fittings, hydraulics, janitorial, mechanical power transmission, pneumatics, process pumps and equipment, safety, seals and gaskets, and tools and testing instruments, as well as maintenance, repair, and operation customers in aggregate and cement, automotive, chemical and allied products, equipment and machinery, equipment rental and leasing, fabricated metals, food and beverage, iron and steel, lumber and wood, oil and gas, pulp and paper, and rubber products. In addition, the company provides various services and repairs comprising gearbox and fluid power and process pump assembly and repair, hydraulic drive shaft repair, electrical panel assembly and repair, hose and gasket manufacture and assembly. It operates in the United States, Canada, France, the United Kingdom, Ireland, Germany, Poland, the Netherlands, Belgium, Spain, Portugal, Australia, New Zealand, Mexico, Indonesia, and Singapore. The company was incorporated in 1928 and is headquartered in Atlanta, Georgia.