Fitbit (FIT) and Huami (HMI) Critical Survey

Fitbit (NYSE:FIT) and Huami (NYSE:HMI) are both small-cap computer and technology companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, profitability, dividends, valuation, analyst recommendations, risk and earnings.

Institutional and Insider Ownership

62.2% of Fitbit shares are held by institutional investors. Comparatively, 10.5% of Huami shares are held by institutional investors. 19.8% of Fitbit shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Fitbit and Huami’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Fitbit -16.32% -24.19% -12.82%
Huami N/A N/A N/A

Valuation and Earnings

This table compares Fitbit and Huami’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Fitbit $1.62 billion 0.81 -$277.19 million ($0.65) -9.38
Huami $314.91 million 1.88 $25.77 million N/A N/A

Huami has lower revenue, but higher earnings than Fitbit.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Fitbit and Huami, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Fitbit 3 6 4 0 2.08
Huami 0 0 1 0 3.00

Fitbit presently has a consensus price target of $5.83, suggesting a potential downside of 4.37%. Huami has a consensus price target of $15.40, suggesting a potential upside of 54.93%. Given Huami’s stronger consensus rating and higher probable upside, analysts clearly believe Huami is more favorable than Fitbit.

Summary

Huami beats Fitbit on 7 of the 11 factors compared between the two stocks.

Fitbit Company Profile

Fitbit, Inc., a technology company, provides health solutions in the United States and internationally. The company offers a line of devices, including Fitbit Surge, Fitbit Blaze, Fitbit Charge 2, Alta HR, Alta, Fitbit Flex 2, Fitbit One, and Fitbit Zip activity trackers; Fitbit Ionic smartwatches; Fitbit Aria 2 Wi-Fi smart scales; and a range of accessories, such as bands and frames for its devices, as well as Fitbit Flyer, a wireless headphone designed for fitness. It also offers Fitbit online dashboard and mobile apps that sync automatically with and display real-time data from its wearable devices; and Fitbit Coach that offers exercise programs through personal trainer and yoga apps. The company sells its products through consumer electronics and specialty, e-commerce, mass merchant, department store, club, and sporting goods and outdoors retailers; wireless carriers; distributors; and Fitbit.com, an online store, as well as directly to consumers. The company was formerly known as Healthy Metrics Research, Inc. and changed its name to Fitbit, Inc. in October 2007. Fitbit, Inc. was founded in 2007 and is headquartered in San Francisco, California.

Huami Company Profile

Huami Corporation, a biometric and activity data-driven company, develops, manufactures, and sells smart wearable technological devices in the People's Republic of China. It operates through two segments, Xiaomi Wearable Products, and Self-Branded Products and Others. The company offers smart bands, watches, and scales; and a range of accessories, including bands, watch straps, necklaces, sportswear, etc. under the Xiaomi brand. It also provides mobile apps, such as Mi Fit that focuses on sports and fitness functions for users of Xiaomi wearable products; and Amazfit, which focuses on functions related to health and medical care for users of its self-branded products. The company was founded in 2013 and is headquartered in Hefei, the People's Republic of China.

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