Head to Head Review: Party City Holdco (PRTY) & Ollie's Bargain Outlet (OLLI)

Party City Holdco (NYSE: PRTY) and Ollie's Bargain Outlet (NASDAQ:OLLI) are both cyclical consumer goods & services companies, but which is the superior business? We will contrast the two businesses based on the strength of their dividends, institutional ownership, risk, earnings, profitability, analyst recommendations and valuation.

Earnings and Valuation

This table compares Party City Holdco and Ollie's Bargain Outlet’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Party City Holdco $2.28 billion 0.73 $117.47 million $0.96 14.64
Ollie's Bargain Outlet $890.32 million 3.61 $59.76 million $1.28 40.70

Party City Holdco has higher revenue and earnings than Ollie's Bargain Outlet. Party City Holdco is trading at a lower price-to-earnings ratio than Ollie's Bargain Outlet, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Party City Holdco and Ollie's Bargain Outlet’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Party City Holdco 4.96% 13.74% 4.12%
Ollie's Bargain Outlet 8.17% 10.55% 7.02%

Insider & Institutional Ownership

89.7% of Ollie's Bargain Outlet shares are owned by institutional investors. 5.0% of Party City Holdco shares are owned by insiders. Comparatively, 22.3% of Ollie's Bargain Outlet shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Party City Holdco and Ollie's Bargain Outlet, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Party City Holdco 0 2 4 0 2.67
Ollie's Bargain Outlet 1 5 7 0 2.46

Party City Holdco currently has a consensus target price of $16.00, indicating a potential upside of 13.88%. Ollie's Bargain Outlet has a consensus target price of $50.00, indicating a potential downside of 4.03%. Given Party City Holdco’s stronger consensus rating and higher possible upside, analysts clearly believe Party City Holdco is more favorable than Ollie's Bargain Outlet.

Summary

Ollie's Bargain Outlet beats Party City Holdco on 8 of the 13 factors compared between the two stocks.

Party City Holdco Company Profile

Party City Holdco Inc. is a holding company with no operating assets or operations. As of December 31, 2016, the Company owned PC Nextco Holdings, LLC (PC Nextco), which owned PC Intermediate Holdings, Inc. (PC Intermediate). As of December 31, 2016, PC Intermediate owned Party City Holdings Inc. (PCHI). PCHI or its direct or indirect subsidiaries conduct all of its operating businesses. The Company operates through two segments: Retail and Wholesale. Its retail operations generate revenue primarily through the sale of its Amscan, Designware, Anagram and Costumes USA party supplies through its Party City stores, Halloween City stores and PartyCity.com. Its wholesale revenues are generated from the sale of party goods for all occasions, including paper and plastic tableware, accessories and novelties, costumes, metallic and latex balloons and stationery.

Ollie's Bargain Outlet Company Profile

Ollie’s Bargain Outlet Holdings, Inc. is a retailer of brand name merchandise. The Company offers customers a selection of brand name products, including food, housewares, books and stationery, bed and bath, floor coverings, electronics and toys. Its warehouse format stores feature a range of products, including hardware, personal healthcare, candy, clothing, sporting goods, pet and lawn and garden products. It offers cooking utensils, dishes, appliances, plastic containers, coffee, bottled non-carbonated beverages, coffee, bottled non-carbonated beverages, bedding, towels, curtains, laminate flooring, commercial and residential carpeting, air conditioners, home electronics, cellular accessories, dolls, action figures, puzzles, action figures, puzzles, educational toys, board games, luggage, automotive, seasonal, furniture, summer furniture and lawn and garden. As of January 28, 2017, it had operated 234 stores across 19 contiguous states in the Eastern half of the United States.

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