Comparing Honest (NASDAQ:HNST) & RDE (NASDAQ:GIFT)

RDE (NASDAQ:GIFT) and Honest (NASDAQ:HNST) are both small-cap consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, institutional ownership, analyst recommendations, risk, valuation, dividends and profitability.

Analyst Ratings

This is a breakdown of recent ratings for RDE and Honest, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
RDE	0	0	0	0	0.00
Honest	0	3	4	1	2.75

Honest has a consensus price target of $6.93, suggesting a potential upside of 8.09%. Given Honest’s stronger consensus rating and higher possible upside, analysts clearly believe Honest is more favorable than RDE.

Insider & Institutional Ownership

45.5% of Honest shares are owned by institutional investors. 20.5% of RDE shares are owned by company insiders. Comparatively, 8.6% of Honest shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares RDE and Honest”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
RDE	$97.01 million	0.24	N/A	N/A	N/A
Honest	$368.77 million	1.75	-$39.24 million	($0.04)	-160.25

RDE has higher earnings, but lower revenue than Honest.

Volatility and Risk

RDE has a beta of -0.73, meaning that its share price is 173% less volatile than the S&P 500. Comparatively, Honest has a beta of 2.45, meaning that its share price is 145% more volatile than the S&P 500.

Profitability

This table compares RDE and Honest’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
RDE	-21.08%	-76.24%	-46.38%
Honest	-1.13%	-3.26%	-2.06%

Summary

Honest beats RDE on 11 of the 12 factors compared between the two stocks.

About RDE

RDE, Inc. owns and operates a restaurant deal space in the United States. The company operates Restaurant.com that connects digital consumers, businesses, and communities with dining and merchant deal options at approximately 182,500 restaurants and retailers to approximately 7.8 million customers. It sells discount certificates for restaurants, as well as complementary entertainment and travel offerings, and consumer products on behalf of third-party merchants. The company is based in Schaumburg, Illinois.

About Honest

The Honest Company, Inc. manufactures and sells diapers and wipes, skin and personal care, and household and wellness products. The company also offers baby clothing and nursery bedding products. It sells its products through digital and retail sales channels, such as its website and third-party ecommerce sites, as well as brick and mortar retailers. The company was incorporated in 2012 and is headquartered in Los Angeles, California.