Financial Contrast: RealReal (NASDAQ:REAL) & Olaplex (NASDAQ:OLPX)

RealReal (NASDAQ:REAL) and Olaplex (NASDAQ:OLPX) are both small-cap consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their dividends, institutional ownership, valuation, earnings, analyst recommendations, profitability and risk.

Institutional & Insider Ownership

64.7% of RealReal shares are held by institutional investors. Comparatively, 87.4% of Olaplex shares are held by institutional investors. 9.0% of RealReal shares are held by company insiders. Comparatively, 4.3% of Olaplex shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares RealReal and Olaplex’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RealReal	-10.78%	N/A	-18.58%
Olaplex	-1.18%	1.31%	0.70%

Risk & Volatility

RealReal has a beta of 2.6, meaning that its share price is 160% more volatile than the S&P 500. Comparatively, Olaplex has a beta of 2.25, meaning that its share price is 125% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings for RealReal and Olaplex, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RealReal	1	2	5	1	2.67
Olaplex	1	4	2	1	2.38

RealReal currently has a consensus target price of $16.79, indicating a potential upside of 6.24%. Olaplex has a consensus target price of $1.85, indicating a potential upside of 37.04%. Given Olaplex’s higher possible upside, analysts clearly believe Olaplex is more favorable than RealReal.

Valuation and Earnings

This table compares RealReal and Olaplex”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RealReal	$600.48 million	3.07	-$134.20 million	($1.38)	-11.45
Olaplex	$422.67 million	2.13	$19.52 million	N/A	N/A

Olaplex has lower revenue, but higher earnings than RealReal.

Summary

Olaplex beats RealReal on 7 of the 13 factors compared between the two stocks.

About RealReal

The RealReal, Inc. operates an online marketplace for resale luxury goods in the United State. The company offers various product categories, including women's fashion, men's fashion, jewelry, and watches. It primarily sells products through online marketplace and retail stores. The company was incorporated in 2011 and is headquartered in San Francisco, California.

About Olaplex

Olaplex Holdings, Inc. develops, manufactures, and sells hair care products in the United States and internationally. The company offers hair care shampoos and conditioners for use in treatment, maintenance, and protection of hair, as well as oil, moisture mask, and nourishing hair serum. It provides hair care products to professional hair salons, retailers, and everyday consumers. The company distributes its products through professional distributors in salons, directly to retailers for sale in their physical stores, e-commerce sites, and its website, Olaplex.com, as well as third party e-commerce platforms. The company was founded in 2014 and is based in Santa Barbara, California.