Critical Comparison: Advantage Solutions (NASDAQ:ADV) vs. Koala (OTCMKTS:KARE)

Koala (OTCMKTS:KARE) and Advantage Solutions (NASDAQ:ADV) are both consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, risk, valuation, dividends, profitability, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Koala and Advantage Solutions, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Koala	0	0	0	0	0.00
Advantage Solutions	1	1	1	0	2.00

Advantage Solutions has a consensus price target of $2.00, indicating a potential upside of 133.18%. Given Advantage Solutions’ stronger consensus rating and higher possible upside, analysts plainly believe Advantage Solutions is more favorable than Koala.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Koala	N/A	N/A	N/A
Advantage Solutions	-6.97%	-34.40%	-8.04%

Earnings and Valuation

This table compares Koala and Advantage Solutions”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Koala	N/A	N/A	N/A	N/A	N/A
Advantage Solutions	$3.57 billion	0.08	-$326.96 million	($0.75)	-1.14

Koala has higher earnings, but lower revenue than Advantage Solutions.

Institutional & Insider Ownership

49.8% of Advantage Solutions shares are owned by institutional investors. 8.1% of Koala shares are owned by insiders. Comparatively, 7.9% of Advantage Solutions shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Advantage Solutions beats Koala on 5 of the 9 factors compared between the two stocks.

About Koala

Koala Corporation, doing business as Tech World, Inc., a technology company, offers technical services in the areas of security administration, architecture and paradigms, access management system and processes, applications development, operations, data encryption, telecommunications, network and WAN, business continuity planning, crime law, and investigation and ethics. It also provides alternative energy sources for commercial offices and residential houses, and retirement homes; secure and phone encryption communication services; cellular and wireless data services; and staff augmentation and forensic recovery services, as well as writes applications for mobile phones. In addition, the company offers products for the government market that include thermal imaging cameras, secure communication systems, cellular and satellite phones, ERP and CRM software, and RFID and tracking equipment; and the fuel industry, such as car and truck HHO systems, fuel additives, water-engine heating and home cooking systems, and acetylene replacements. Further, it provides products for the television (TV) market, including 2-D to 3-D conversion boxes, cable TV networks, Internet over cable systems, and satellite TV and data systems; and the telecom market, such as calling cards, direct VOIP systems, WI-max and mobile banking systems, network management products, and unified communication systems, as well as for green-energy and bank markets. The company was incorporated in 1993 and is based in Vienna, Virginia.

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.