Solesence (NASDAQ:SLSN) vs. European Wax Center (NASDAQ:EWCZ) Critical Review

Solesence (NASDAQ:SLSN) and European Wax Center (NASDAQ:EWCZ) are both small-cap consumer staples companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, risk, profitability, valuation, analyst recommendations, dividends and institutional ownership.

Insider & Institutional Ownership

70.2% of Solesence shares are held by institutional investors. Comparatively, 82.1% of European Wax Center shares are held by institutional investors. 4.8% of Solesence shares are held by insiders. Comparatively, 5.0% of European Wax Center 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.

Profitability

This table compares Solesence and European Wax Center’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Solesence	8.13%	32.99%	9.74%
European Wax Center	4.20%	28.38%	3.93%

Analyst Ratings

This is a summary of current recommendations for Solesence and European Wax Center, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Solesence	0	1	0	0	2.00
European Wax Center	1	4	1	0	2.00

European Wax Center has a consensus target price of $6.93, suggesting a potential upside of 113.84%. Given European Wax Center’s higher possible upside, analysts plainly believe European Wax Center is more favorable than Solesence.

Risk & Volatility

Solesence has a beta of 0.94, meaning that its stock price is 6% less volatile than the S&P 500. Comparatively, European Wax Center has a beta of 1.45, meaning that its stock price is 45% more volatile than the S&P 500.

Valuation and Earnings

This table compares Solesence and European Wax Center”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Solesence	$64.42 million	3.90	$4.24 million	$0.07	50.86
European Wax Center	$216.92 million	0.82	$10.46 million	$0.20	16.20

European Wax Center has higher revenue and earnings than Solesence. European Wax Center is trading at a lower price-to-earnings ratio than Solesence, indicating that it is currently the more affordable of the two stocks.

Summary

European Wax Center beats Solesence on 8 of the 13 factors compared between the two stocks.

About Solesence

Nanophase Technologies Corporation provides engineered materials, formulation development, and commercial manufacturing with an integrated family of technologies in the United States. It offers surface engineered zinc oxide and titanium dioxide for sunscreens and personal care products; fully formulated cosmetics, sun care, and skin care under the Solésence brand name; and advanced materials products, such as architectural coatings, industrial coatings, abrasion-resistant additives, plastics additives, medical diagnostics, and various surface finishing technologies applications. The company was incorporated in 1989 and is headquartered in Romeoville, Illinois.

About European Wax Center

European Wax Center, Inc. operates as the franchisor and operator of out-of-home waxing services in the United States. It offers body and facial waxing services; and pre- and post-service products, including ingrown hair serums, exfoliating gels, brow shapers, and skin treatments. The company was founded in 2004 and is headquartered in Plano, Texas.