Critical Contrast: BJ’s Wholesale Club (NYSE:BJ) & Synergy CHC (NASDAQ:SNYR)

BJ’s Wholesale Club (NYSE:BJ) and Synergy CHC (NASDAQ:SNYR) are both consumer staples companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, profitability, valuation, risk, institutional ownership, earnings and analyst recommendations.

Insider and Institutional Ownership

98.6% of BJ’s Wholesale Club shares are owned by institutional investors. 1.4% of BJ’s Wholesale Club shares are owned by insiders. Comparatively, 56.6% of Synergy CHC shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares BJ’s Wholesale Club and Synergy CHC’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
BJ’s Wholesale Club	2.72%	28.66%	7.99%
Synergy CHC	7.77%	-19.51%	14.25%

Valuation and Earnings

This table compares BJ’s Wholesale Club and Synergy CHC”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BJ’s Wholesale Club	$20.50 billion	0.59	$534.42 million	$4.34	21.24
Synergy CHC	$34.83 million	0.60	$2.12 million	$0.29	6.36

BJ’s Wholesale Club has higher revenue and earnings than Synergy CHC. Synergy CHC is trading at a lower price-to-earnings ratio than BJ’s Wholesale Club, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings for BJ’s Wholesale Club and Synergy CHC, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BJ’s Wholesale Club	0	9	10	0	2.53
Synergy CHC	0	1	2	0	2.67

BJ’s Wholesale Club currently has a consensus target price of $111.67, indicating a potential upside of 21.17%. Synergy CHC has a consensus target price of $8.50, indicating a potential upside of 360.70%. Given Synergy CHC’s stronger consensus rating and higher probable upside, analysts plainly believe Synergy CHC is more favorable than BJ’s Wholesale Club.

Volatility and Risk

BJ’s Wholesale Club has a beta of 0.31, meaning that its stock price is 69% less volatile than the S&P 500. Comparatively, Synergy CHC has a beta of 3.46, meaning that its stock price is 246% more volatile than the S&P 500.

About BJ’s Wholesale Club

BJ’s Wholesale Club Holdings, Inc. engages in the operation of membership warehouse clubs. Its product categories include grocery, household and pet, television and electronics, furniture, computer and tablets, patio and outdoor living, lawn and garden, baby and kids, toys, home, health and beauty, appliances, and jewelry. The company was founded in 1984 and is headquartered in Marlborough, MA.

About Synergy CHC

Synergy CHC Corp. engages in the marketing and distribution of branded health and wellness products. The company was founded on December 29, 2010 and is headquartered in Westbrook, ME.