Party City Holdco (NYSE: PRTY) and Suburban Propane Partners (NYSE:SPH) are both small-cap consumer discretionary companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, earnings, dividends, institutional ownership, profitability, analyst recommendations and risk.

Dividends

Suburban Propane Partners pays an annual dividend of $2.40 per share and has a dividend yield of 10.2%. Party City Holdco does not pay a dividend. Suburban Propane Partners pays out 342.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Institutional and Insider Ownership

29.0% of Suburban Propane Partners shares are held by institutional investors. 6.5% of Party City Holdco shares are held by company insiders. Comparatively, 0.8% of Suburban Propane Partners shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Party City Holdco and Suburban Propane Partners’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Party City Holdco $2.37 billion 0.62 $215.34 million $1.20 12.63
Suburban Propane Partners $1.19 billion 1.22 $37.99 million $0.70 33.60

Party City Holdco has higher revenue and earnings than Suburban Propane Partners. Party City Holdco is trading at a lower price-to-earnings ratio than Suburban Propane Partners, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Party City Holdco and Suburban Propane Partners, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Party City Holdco 0 2 4 0 2.67
Suburban Propane Partners 1 2 2 0 2.20

Party City Holdco presently has a consensus price target of $18.83, indicating a potential upside of 24.31%. Suburban Propane Partners has a consensus price target of $26.60, indicating a potential upside of 13.10%. Given Party City Holdco’s stronger consensus rating and higher possible upside, analysts plainly believe Party City Holdco is more favorable than Suburban Propane Partners.

Profitability

This table compares Party City Holdco and Suburban Propane Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Party City Holdco 9.11% 14.56% 4.24%
Suburban Propane Partners 4.79% 10.69% 2.88%

Risk & Volatility

Party City Holdco has a beta of 2.13, meaning that its stock price is 113% more volatile than the S&P 500. Comparatively, Suburban Propane Partners has a beta of 0.64, meaning that its stock price is 36% less volatile than the S&P 500.

Summary

Party City Holdco beats Suburban Propane Partners on 12 of the 16 factors compared between the two stocks.

Party City Holdco Company Profile

Party City Holdco Inc., through its subsidiaries, designs, manufactures, sources, and distributes party supplies in the United States and internationally. The company operates in two segments, Retail and Wholesale. It offers paper and plastic tableware, metallic and latex balloons, Halloween and other costumes, accessories and novelties, stationery, and decorations. As of March 9, 2018, the company offered its products through its 900 specialty retail party supply stores, including approximately 150 franchise stores in North America under the Party City and Halloween City names; and e-commerce Websites, principally through the domain name PartyCity.com. In addition, it franchises individual stores and franchise areas throughout the United States, Mexico, and Puerto Rico principally under the Party City name. The company offers its products through company-owned stores, independent party supply stores, mass merchants, grocery retailers, and dollar stores, as well as through other retailers and distributors. Party City Holdco Inc. was founded in 1947 and is based in Elmsford, New York.

Suburban Propane Partners Company Profile

Suburban Propane Partners, L.P., through its subsidiaries, engages in the retail marketing and distribution of propane, fuel oil, and refined fuels. Its Propane segment is involved in the retail distribution of propane to residential, commercial, industrial, and agricultural customers, as well as in the wholesale distribution to industrial end users. This segment offers propane primarily for space heating, water heating, cooking, and clothes drying in the residential and commercial markets; for use as a motor fuel in internal combustion engines to power over-the-road vehicles, forklifts, and stationary engines, as well as to fire furnaces, as a cutting gas to the industrial customers, and in other process applications; and for tobacco curing, crop drying, poultry brooding, and weed control in the agricultural markets. The company's Fuel Oil and Refined Fuels segment engages in the retail distribution of fuel oil, diesel, kerosene, and gasoline to residential and commercial customers for use primarily as a source of heat in homes and buildings. Its Natural Gas and Electricity segment markets natural gas and electricity to residential and commercial customers in the deregulated energy markets in New York and Pennsylvania. The company also sells, installs, and services a range of home comfort equipment, including whole-house heating products, air cleaners, humidifiers, and space heaters. As of September 30, 2017, it served approximately 1.0 million residential, commercial, industrial, and agricultural customers through 668 locations in 41 states primarily in the east and west coast regions of the United States, as well as portions of the midwest region of the United States and Alaska. Suburban Energy Services Group LLC serves as a general partner of Suburban Propane Partners, L.P. The company was founded in 1945 and is headquartered in Whippany, New Jersey.

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