Central Garden & Pet (NASDAQ:CENTA) and Educational Development (NASDAQ:EDUC) are both small-cap consumer discretionary companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, dividends, valuation, earnings, analyst recommendations, risk and institutional ownership.
Valuation and Earnings
This table compares Central Garden & Pet and Educational Development’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Central Garden & Pet||$2.05 billion||0.76||$78.82 million||$1.50||19.87|
|Educational Development||$111.97 million||0.85||$5.21 million||N/A||N/A|
Educational Development pays an annual dividend of $0.20 per share and has a dividend yield of 1.7%. Central Garden & Pet does not pay a dividend. Educational Development has increased its dividend for 2 consecutive years.
Institutional & Insider Ownership
63.9% of Central Garden & Pet shares are held by institutional investors. Comparatively, 8.3% of Educational Development shares are held by institutional investors. 20.3% of Central Garden & Pet shares are held by insiders. Comparatively, 23.6% of Educational Development shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.
This is a breakdown of current ratings and recommmendations for Central Garden & Pet and Educational Development, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Central Garden & Pet||0||0||4||0||3.00|
Central Garden & Pet presently has a consensus target price of $43.33, indicating a potential upside of 45.37%. Given Central Garden & Pet’s higher possible upside, analysts plainly believe Central Garden & Pet is more favorable than Educational Development.
Volatility and Risk
Central Garden & Pet has a beta of 0.08, meaning that its stock price is 92% less volatile than the S&P 500. Comparatively, Educational Development has a beta of 1.45, meaning that its stock price is 45% more volatile than the S&P 500.
This table compares Central Garden & Pet and Educational Development’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Central Garden & Pet||5.32%||14.69%||6.37%|
Educational Development beats Central Garden & Pet on 7 of the 13 factors compared between the two stocks.
Central Garden & Pet Company Profile
Central Garden & Pet Company, together with its subsidiaries, produces and distributes products for the lawn and garden, and pet supplies markets in the United States. It operates through two segments, Pet and Garden. The Pet segment supplies products for dogs and cats comprising edible bones, edible and non-edible chews, rawhide, dog and cat food and treats, toys, pet carriers, grooming supplies, and other accessories; and food, cages and habitats, toys, chews, and related accessories for birds, small animals, and specialty pets. It also offers animal and household health, and insect control products; aquariums, furniture and lighting fixtures, pumps, filters, water conditioners, food and supplements, and information and knowledge resources for fish, reptiles, and other aquarium-based pets; and products for horses and livestock. This segment sells its products to independent pet distributors, retail chains, grocery stores, mass merchants, and bookstores under the Adams, Aqueon, Avoderm, Bio Spot Active Care, Cadet, Farnam, Four Paws, Kaytee, K&H Pet Products, Nylabone, Pinnacle, TFH, Zilla, Altosid, Comfort Zone, Coralife, Interpet, Kent Marine, Pet Select, Super Pet, and Zodiac brands. The Garden segment provides grass seeds; wild bird feed, bird feeders, bird houses, and other birding accessories; weed, grass, and other herbicide, insecticide, and pesticide products; fertilizers; and decorative outdoor lifestyle products, such as pottery, trellises, and other wood products. This segment sells its products to retail chains, independent garden distributors, grocery stores, nurseries, and garden supply retailers under the AMDRO, Ironite, Pennington, Sevin, Lilly Miller, Over-N-Out, Smart Seed, and The Rebels brands. The company is also involved in the distribution of third party pet, and lawn and garden products. Central Garden & Pet Company was founded in 1955 and is headquartered in Walnut Creek, California.
Educational Development Company Profile
Educational Development Corporation, a publishing company, operates as a trade co-publisher of the line of educational children's books in the United States. The company offers various books, including Touchy-Feely board books, activity and flashcards, adventure and search books, art books, sticker books, and foreign language books, as well as science and math titles, and chapter books and novels. It operates through two divisions, Home Business and Publishing. The Home Business division distributes books through a network of independent consultants, who hold book showings in individual homes; and through social media, book fairs, direct sales, and Internet sales. This division distributes its products to school and public libraries. The Publishing division markets books to bookstores, toy stores, specialty stores, museums, and other retail outlets throughout the country. The company distributes children's books published by Usborne Publishing Limited in the United Kingdom. Educational Development Corporation was founded in 1965 and is headquartered in Tulsa, Oklahoma.
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