CAR vs Pool Which Is More Attractive?

Investors often debate between investing in traditional car stocks and newer pool stocks. Car stocks represent well-established companies in the automotive industry, which have a long history of generating profits. On the other hand, pool stocks represent companies that focus on providing shared transportation services, such as ride-hailing and carpooling. While car stocks offer stability and potential growth, pool stocks provide innovative solutions to modern transportation needs. Both types of stocks have their own advantages and risks, making it essential for investors to carefully evaluate their investment strategy.

CAR or Pool?

When comparing CAR and Pool, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between CAR and Pool.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. CAR has a dividend yield of 1.92%, while Pool has a dividend yield of 1.29%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. CAR reports a 5-year dividend growth of 7.68% year and a payout ratio of 98.63%. On the other hand, Pool reports a 5-year dividend growth of 20.11% year and a payout ratio of 39.39%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with CAR P/E ratio at 57.51 and Pool's P/E ratio at 30.74. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. CAR P/B ratio is 4.98 while Pool's P/B ratio is 9.62.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, CAR has seen a 5-year revenue growth of 0.42%, while Pool's is 0.93%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with CAR's ROE at 8.54% and Pool's ROE at 32.53%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are A$37.68 for CAR and $360.21 for Pool. Over the past year, CAR's prices ranged from A$29.82 to A$42.70, with a yearly change of 43.21%. Pool's prices fluctuated between $293.51 and $422.73, with a yearly change of 44.03%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.