Head to Head Analysis: Herc Holdings (HRI) & eHi Car Services Limited (NYSE:EHIC)

eHi Car Services Limited (NYSE: EHIC) and Herc Holdings (NYSE:HRI) are both small-cap consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, earnings, valuation, institutional ownership, dividends, analyst recommendations and profitability.

Valuation and Earnings

This table compares eHi Car Services Limited and Herc Holdings’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
eHi Car Services Limited $337.16 million 1.89 $150.61 million $0.14 66.43
Herc Holdings $1.61 billion 0.65 $108.90 million ($2.75) -13.36

eHi Car Services Limited has higher revenue, but lower earnings than Herc Holdings. Herc Holdings is trading at a lower price-to-earnings ratio than eHi Car Services Limited, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

29.4% of eHi Car Services Limited shares are owned by institutional investors. Comparatively, 99.7% of Herc Holdings shares are owned by institutional investors. 12.0% of eHi Car Services Limited shares are owned by company insiders. Comparatively, 0.1% of Herc Holdings shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current ratings for eHi Car Services Limited and Herc Holdings, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
eHi Car Services Limited 0 0 0 0 N/A
Herc Holdings 0 4 3 0 2.43

Herc Holdings has a consensus target price of $43.83, suggesting a potential upside of 19.34%. Given Herc Holdings’ higher possible upside, analysts plainly believe Herc Holdings is more favorable than eHi Car Services Limited.

Profitability

This table compares eHi Car Services Limited and Herc Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
eHi Car Services Limited 2.98% 1.68% 0.86%
Herc Holdings -4.82% -9.52% -0.82%

Volatility and Risk

eHi Car Services Limited has a beta of 0.42, meaning that its share price is 58% less volatile than the S&P 500. Comparatively, Herc Holdings has a beta of 2.52, meaning that its share price is 152% more volatile than the S&P 500.

Summary

eHi Car Services Limited beats Herc Holdings on 7 of the 12 factors compared between the two stocks.

eHi Car Services Limited Company Profile

eHi Car Services Limited, formerly Prudent Choice International Limited, is a holding company. The Company is engaged in car rentals and car services. The Company provides self-drive car rental services to both individual customers, as well as corporate and institutional clients to meet travel, leisure, business and ground transportation needs. The Company operates its car rentals business primarily through its subsidiaries, including Shanghai eHi Car Rental Co., Ltd. (eHi Rental), eHi Auto Services (Jiangsu) Co., Ltd. (eHi Jiangsu), and their subsidiaries and branches. For its car services business, the Company provides vehicles and chauffeur services through different subsidiaries. The Company provides chauffeur services through its subsidiary, Shanghai Smart Brand Auto Driving Services Co., Ltd. (Shanghai Smart Brand), and its subsidiaries and branches. The Company has a limited operating history.

Herc Holdings Company Profile

Herc Holdings Inc. is an equipment rental supplier. The Company operates approximately 280 branches, of which approximately 270 are in the United States and Canada. It supplies equipment to the markets, including commercial and residential construction, industrial and manufacturing, refineries and petrochemicals, civil infrastructure, automotive, government and municipalities, energy, remediation, emergency response, facilities, entertainment and agriculture. It operates through its Herc Rentals Inc. subsidiary. Its equipment rental business is supported by ProSolutions, its industry-specific solutions-based services, and its ProContractor Tools line. The ProContractor equipment line includes a range of tools, such as air compressors and tool, climate control, plumbing, care and surface preparation. The ProSolutions Industrial Services is a global operation providing an industrial line of products and services, including mobile tool rooms and asset management systems.

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