Bath & Body Works (NYSE:BBWI) & Rent the Runway (NASDAQ:RENT) Head-To-Head Review

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

Institutional and Insider Ownership

95.1% of Bath & Body Works shares are held by institutional investors. Comparatively, 73.1% of Rent the Runway shares are held by institutional investors. 0.3% of Bath & Body Works shares are held by insiders. Comparatively, 6.6% of Rent the Runway shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Profitability

This table compares Bath & Body Works and Rent the Runway’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bath & Body Works	12.43%	-44.03%	14.45%
Rent the Runway	-26.60%	N/A	-28.93%

Risk & Volatility

Bath & Body Works has a beta of 1.89, suggesting that its share price is 89% more volatile than the S&P 500. Comparatively, Rent the Runway has a beta of 1.32, suggesting that its share price is 32% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings for Bath & Body Works and Rent the Runway, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bath & Body Works	0	5	13	0	2.72
Rent the Runway	0	0	3	0	3.00

Bath & Body Works presently has a consensus target price of $45.06, indicating a potential upside of 62.01%. Rent the Runway has a consensus target price of $31.33, indicating a potential upside of 588.64%. Given Rent the Runway’s stronger consensus rating and higher possible upside, analysts plainly believe Rent the Runway is more favorable than Bath & Body Works.

Earnings and Valuation

This table compares Bath & Body Works and Rent the Runway”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bath & Body Works	$7.31 billion	0.82	$878.00 million	$3.64	7.64
Rent the Runway	$305.60 million	0.06	-$113.20 million	($22.16)	-0.21

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

Summary

Bath & Body Works beats Rent the Runway on 10 of the 14 factors compared between the two stocks.

About Bath & Body Works

Bath & Body Works, Inc. is a specialty retailers and home to America’s Favorite Fragrances, offering a breadth of exclusive fragrances for the body and home, including the selling collections for fine fragrance mist, body lotion and body cream, 3-wick candles, home fragrance diffusers and liquid hand soap. The company was founded by Leslie Herbert Wexner in 1963 and is headquartered in Columbus, OH.

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.