Weight Watchers International (WW) & Carriage Services (CSV) Critical Analysis

Weight Watchers International (NASDAQ:WW) and Carriage Services (NYSE:CSV) are both small-cap consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, profitability, dividends, valuation, earnings, risk and analyst recommendations.

Analyst Recommendations

This is a breakdown of current recommendations for Weight Watchers International and Carriage Services, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Weight Watchers International 2 1 0 0 1.33
Carriage Services 0 0 1 0 3.00

Weight Watchers International currently has a consensus price target of $19.00, suggesting a potential upside of 0.05%. Carriage Services has a consensus price target of $26.00, suggesting a potential upside of 28.84%. Given Carriage Services’ stronger consensus rating and higher probable upside, analysts plainly believe Carriage Services is more favorable than Weight Watchers International.

Earnings & Valuation

This table compares Weight Watchers International and Carriage Services’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Weight Watchers International $1.51 billion 0.84 $223.75 million $3.19 5.95
Carriage Services $267.99 million 1.37 $11.65 million $1.17 17.25

Weight Watchers International has higher revenue and earnings than Carriage Services. Weight Watchers International is trading at a lower price-to-earnings ratio than Carriage Services, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Weight Watchers International and Carriage Services’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Weight Watchers International 11.84% -20.48% 12.29%
Carriage Services 3.35% 7.69% 1.91%

Volatility and Risk

Weight Watchers International has a beta of 2.37, meaning that its share price is 137% more volatile than the S&P 500. Comparatively, Carriage Services has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500.

Institutional & Insider Ownership

80.4% of Weight Watchers International shares are held by institutional investors. Comparatively, 77.5% of Carriage Services shares are held by institutional investors. 12.0% of Weight Watchers International shares are held by insiders. Comparatively, 11.9% of Carriage Services shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

Carriage Services pays an annual dividend of $0.30 per share and has a dividend yield of 1.5%. Weight Watchers International does not pay a dividend. Carriage Services pays out 25.6% of its earnings in the form of a dividend. Carriage Services has raised its dividend for 3 consecutive years.

Summary

Weight Watchers International beats Carriage Services on 9 of the 17 factors compared between the two stocks.

About Weight Watchers International

Weight Watchers International, Inc. provides weight management services worldwide. The company operates in four segments: North America, Continental Europe, United Kingdom, and Other. It provides a range of products and services comprising nutritional, activity, behavioral, and lifestyle tools and approaches. The company offers various digital subscription products to wellness and weight management business, which provide interactive and personalized resources that allow users to follow its weight management program via its Web-based and mobile app products, including personal coaching products; and allows members to support each other by sharing their experiences with other people on weight management and wellness journeys. Further, it provides various products, including bars, snacks, cookbooks, kitchen tools, and other products. Additionally, the company licenses its trademarks and other intellectual property in food, beverages, and other consumer products and services. It offers products through its e-commerce platform, magazine subscriptions, publishing, and third-party advertising in publications; and through Websites and sales from the By Mail product. The company was founded in 1961 and is headquartered in New York, New York.

About Carriage Services

Carriage Services, Inc. provides funeral and cemetery services, and merchandise in the United States. It operates through two segments, Funeral Home Operations and Cemetery Operations. The Funeral Home Operations segment offers burial, cremation, and consultation services; removes and prepares remains; sells caskets, urns, and related funeral merchandise; and enables the use of funeral home facilities for visitation, remembrance, and transportation services. The Cemetery Operations segment provides products and services, such as interment services; the rights to interment in cemetery sites comprising grave sites, mausoleum crypts, and niches; and related cemetery merchandise, including memorials and vaults. As of December 31, 2018, the company operated 182 funeral homes in 29 states; and 29 cemeteries in 11 states. Carriage Services, Inc. was founded in 1991 and is headquartered in Houston, Texas.

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