Newegg Commerce (NASDAQ:NEGG) vs. Groupon (NASDAQ:GRPN) Critical Comparison

Groupon (NASDAQ:GRPN) and Newegg Commerce (NASDAQ:NEGG) are both small-cap retail/wholesale companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, valuation, earnings, analyst recommendations and dividends.

Insider and Institutional Ownership

90.1% of Groupon shares are held by institutional investors. Comparatively, 0.5% of Newegg Commerce shares are held by institutional investors. 35.7% of Groupon shares are held by insiders. Comparatively, 22.9% of Newegg Commerce shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

This table compares Groupon and Newegg Commerce”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Groupon	$498.42 million	0.86	-$83.52 million	($2.12)	-4.94
Newegg Commerce	$1.24 million	1,244.89	-$43.33 million	N/A	N/A

Newegg Commerce has lower revenue, but higher earnings than Groupon.

Profitability

This table compares Groupon and Newegg Commerce’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Groupon	-16.76%	-717.37%	-13.09%
Newegg Commerce	N/A	N/A	N/A

Volatility and Risk

Groupon has a beta of -0.02, suggesting that its stock price is 102% less volatile than the S&P 500. Comparatively, Newegg Commerce has a beta of 4.19, suggesting that its stock price is 319% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for Groupon and Newegg Commerce, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Groupon	2	1	2	0	2.00
Newegg Commerce	1	0	0	0	1.00

Groupon presently has a consensus price target of $33.67, indicating a potential upside of 221.55%. Given Groupon’s stronger consensus rating and higher possible upside, analysts plainly believe Groupon is more favorable than Newegg Commerce.

About Groupon

Groupon, Inc., together with its subsidiaries, operates a marketplace that connects consumers to merchants. It operates in two segments, North America and International. The company sells goods or services on behalf of third-party merchants. It serves customers through its mobile applications and websites. The company was formerly known as ThePoint.com, Inc. and changed its name to Groupon, Inc. in October 2008. Groupon, Inc. was incorporated in 2008 and is headquartered in Chicago, Illinois.

About Newegg Commerce

Newegg Commerce, Inc. operates as an electronics-focused e-retailer in North America. The company offers desktops, laptops, gaming laptops, peripherals, and accessories; CPU/processors, graphic cards, motherboards, storage devices, and computer accessories; home video and audio, headphones, pro audio/video, cellphones, wearables, and digital cameras; display and printing, office technology furniture, office supplies, and mailing and inventory supplies; and software, digital downloads, warranty and services, 3rd party gift cards, and entertainment products. It also provides Xbox, PlayStation, home networking, server and components, smart home products, car electronics, motorcycles and ATV, wheels and tires, home improvement tools, home appliances, kitchen utensils, outdoor and garden furniture, fitness, and sports and health products. The company operates B2C platforms, including Newegg.com, Newegg.ca, and Newegg Global, as well as mobile apps; and B2B platforms comprising NeweggBusiness.com. The company was founded in 2001 and is headquartered in City of Industry, California. Newegg Commerce, Inc. is a subsidiary of Hangzhou Liaison Interactive Information Technology Co., Ltd.