Contrasting Rent the Runway (NASDAQ:RENT) and Vera Bradley (NASDAQ:VRA)

Vera Bradley (NASDAQ:VRA) and Rent the Runway (NASDAQ:RENT) are both small-cap retail/wholesale companies, but which is the better business? We will compare the two companies based on the strength of their profitability, institutional ownership, valuation, risk, analyst recommendations, earnings and dividends.

Earnings and Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Vera Bradley	$269.65 million	0.36	-$62.19 million	($3.50)	-0.99
Rent the Runway	$306.20 million	0.49	-$69.90 million	($2.92)	-1.54

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

Analyst Recommendations

This is a breakdown of recent recommendations for Vera Bradley and Rent the Runway, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Vera Bradley	1	2	0	0	1.67
Rent the Runway	1	2	0	0	1.67

Risk & Volatility

Vera Bradley has a beta of 1.76, meaning that its share price is 76% more volatile than the S&P 500. Comparatively, Rent the Runway has a beta of 1.28, meaning that its share price is 28% more volatile than the S&P 500.

Insider & Institutional Ownership

59.9% of Vera Bradley shares are held by institutional investors. Comparatively, 73.1% of Rent the Runway shares are held by institutional investors. 12.1% of Vera Bradley shares are held by company insiders. Comparatively, 8.2% of Rent the Runway shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Vera Bradley	-17.74%	-11.85%	-6.32%
Rent the Runway	3.37%	N/A	-36.65%

Summary

Rent the Runway beats Vera Bradley on 7 of the 11 factors compared between the two stocks.

About Vera Bradley

Vera Bradley, Inc., together with its subsidiaries, designs, manufactures, and sells women’s handbags, luggage and travel items, fashion and home accessories, and gifts. It operates through three segments: Vera Bradley Direct, Vera Bradley Indirect, and Pura Vida. The company offers bag products, such as totes, crossbodies, satchels, clutches, backpacks, baby bags, and lunch bags; accessories, including ID holders, lanyards, wallets, wristlets, eyewear, scarves, hair accessories, and various technology accessories; bracelets, rings, and necklaces under Pura Vida brand name; and travel products consist of rolling luggage, cosmetics, and travel and packing accessories, as well as travel bags comprising duffel and weekend bags. It also provides home products that include throw blankets, beach towels, and comforters, as well as items, such as mugs and tumblers; apparel/footwear comprising sleepwear, footwear, outerwear, tees and hoodies, and socks; and stationery and merchandising products, as well as freight, licensing, and gift card breakage services. The company sells its Vera Bradley branded products through its full-line and outlet stores in the United States; verabradley.com, an online outlet site; its annual outlet sale in Fort Wayne, Indiana. It sells its Pura Vida branded products through wholesale retailers and Pura Vida websites, including www.puravidabracelets.com, www.puravidabracelets.eu, and www.puravidabracelets.ca; and Vera Bradley Indirect branded products to specialty retail locations, department stores, national accounts, third party e-commerce sites, third-party inventory liquidators, and through licensing agreements. Vera Bradley, Inc. was incorporated in 1982 and is headquartered in Roanoke, Indiana.

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.