Critical Analysis: ThredUp (NASDAQ:TDUP) and RDE (NASDAQ:GIFT)

ThredUp (NASDAQ:TDUP) and RDE (NASDAQ:GIFT) are both small-cap consumer staples companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, analyst recommendations, earnings, valuation, risk, profitability and dividends.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
ThredUp	-22.16%	-78.74%	-29.58%
RDE	-21.08%	-76.24%	-46.38%

Analyst Ratings

This is a breakdown of recent ratings and target prices for ThredUp and RDE, as provided by MarketBeat.com.

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

ThredUp presently has a consensus price target of $3.50, indicating a potential upside of 65.09%. Given ThredUp’s stronger consensus rating and higher probable upside, equities analysts plainly believe ThredUp is more favorable than RDE.

Volatility and Risk

ThredUp has a beta of 1.66, indicating that its share price is 66% more volatile than the S&P 500. Comparatively, RDE has a beta of -0.73, indicating that its share price is 173% less volatile than the S&P 500.

Valuation & Earnings

This table compares ThredUp and RDE”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ThredUp	$322.02 million	0.75	-$71.25 million	($0.64)	-3.31
RDE	$97.01 million	0.27	N/A	N/A	N/A

RDE has lower revenue, but higher earnings than ThredUp.

Insider and Institutional Ownership

89.1% of ThredUp shares are held by institutional investors. 34.4% of ThredUp shares are held by insiders. Comparatively, 20.5% of RDE shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

ThredUp beats RDE on 9 of the 11 factors compared between the two stocks.

About ThredUp

ThredUp Inc., together with its subsidiaries, operates an online resale platform in the United States and internationally. Its platform enables consumers to buy and sell primarily secondhand apparel, shoes, and accessories. ThredUp Inc. was incorporated in 2009 and is headquartered in Oakland, California.

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.