Contrasting Rent the Runway (NASDAQ:RENT) and ON (NYSE:ONON)

Rent the Runway (NASDAQ:RENT) and ON (NYSE:ONON) are both retail/wholesale companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, risk, dividends, analyst recommendations, profitability, earnings and valuation.

Profitability

This table compares Rent the Runway and ON’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Rent the Runway	3.37%	N/A	-36.65%
ON	7.45%	14.81%	8.48%

Risk & Volatility

Rent the Runway has a beta of 1.26, meaning that its stock price is 26% more volatile than the S&P 500. Comparatively, ON has a beta of 2.15, meaning that its stock price is 115% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Rent the Runway and ON, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Rent the Runway	1	2	0	0	1.67
ON	2	3	17	2	2.79

ON has a consensus target price of $59.86, suggesting a potential upside of 32.37%. Given ON’s stronger consensus rating and higher possible upside, analysts plainly believe ON is more favorable than Rent the Runway.

Earnings & Valuation

This table compares Rent the Runway and ON”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Rent the Runway	$306.20 million	0.70	-$69.90 million	($2.92)	-2.20
ON	$2.63 billion	10.78	$275.23 million	$0.77	58.73

ON has higher revenue and earnings than Rent the Runway. Rent the Runway is trading at a lower price-to-earnings ratio than ON, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

73.1% of Rent the Runway shares are held by institutional investors. Comparatively, 36.4% of ON shares are held by institutional investors. 8.2% of Rent the Runway shares are held by company insiders. Comparatively, 68.6% of ON shares are held by company 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.

Summary

ON beats Rent the Runway on 14 of the 15 factors compared between the two stocks.

About Rent the Runway

Rent the Runway, Inc. operates shared designer closet in the United States. The company offers evening wear and accessories, ready-to-wear, workwear, denim, casual, maternity, outerwear, blouses, knitwear, loungewear, jewelry, handbags, activewear, and ski wear under subscription, rental, and resale offering. It also engages in the software development and support activities. Rent the Runway, Inc. was incorporated in 2009 and is headquartered in Brooklyn, New York.

About ON

On Holding AG engages in the development and distribution of sports products such as footwear, apparel, and accessories for high-performance running, outdoor, all-day activities, and tennis. It sells its products worldwide through independent retailers and global distributors, its own online presence, and its own stores. The company was founded by David Allemann, Olivier Bernhard, and Caspar Coppetti in January 2010 and is headquartered in Zurich, Switzerland.