Comparing BRC (NYSE:BRCC) & BJ’s Wholesale Club (NYSE:BJ)

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

Valuation and Earnings

This table compares BJ’s Wholesale Club and BRC”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
BJ’s Wholesale Club	$21.46 billion	0.57	$578.38 million	$4.38	21.61
BRC	$398.26 million	0.49	-$11.91 million	($0.14)	-5.61

BJ’s Wholesale Club has higher revenue and earnings than BRC. BRC 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.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
BJ’s Wholesale Club	2.70%	27.55%	7.90%
BRC	-2.99%	-21.46%	-5.42%

Institutional & Insider Ownership

98.6% of BJ’s Wholesale Club shares are held by institutional investors. Comparatively, 16.3% of BRC shares are held by institutional investors. 1.4% of BJ’s Wholesale Club shares are held by company insiders. Comparatively, 69.0% of BRC shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of current ratings for BJ’s Wholesale Club and BRC, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
BJ’s Wholesale Club	1	10	9	0	2.40
BRC	1	1	1	0	2.00

BJ’s Wholesale Club currently has a consensus price target of $107.63, suggesting a potential upside of 13.68%. BRC has a consensus price target of $2.33, suggesting a potential upside of 196.86%. Given BRC’s higher possible upside, analysts clearly believe BRC is more favorable than BJ’s Wholesale Club.

Volatility and Risk

BJ’s Wholesale Club has a beta of 0.36, meaning that its share price is 64% less volatile than the S&P 500. Comparatively, BRC has a beta of 0.76, meaning that its share price is 24% less volatile than the S&P 500.

Summary

BJ’s Wholesale Club beats BRC on 11 of the 14 factors compared between the two stocks.

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 BRC

BRC Inc., through its subsidiaries, purchases, roasts, and sells coffee, coffee accessories, and branded apparel in the United States. The company also produces media content, as well as sells coffee brewing equipment, and outdoor and lifestyle gear. It supports active military, veterans, and first responders. The company offers its products through grocery, specialty stores, and other intermediaries; and company operated and franchised Black Rifle Coffee retail coffee shop locations, as well as through e-commerce. BRC Inc. was founded in 2014 and is based in Salt Lake City, Utah.