Head to Head Comparison: ACV Auctions (NASDAQ:ACVA) vs. Zhongsheng Group (OTCMKTS:ZSHGY)

Zhongsheng Group (OTCMKTS:ZSHGY) and ACV Auctions (NASDAQ:ACVA) are both consumer cyclical companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, earnings, institutional ownership, risk, valuation, profitability and analyst recommendations.

Profitability

This table compares Zhongsheng Group and ACV Auctions’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zhongsheng Group	N/A	N/A	N/A
ACV Auctions	-14.53%	-13.20%	-6.17%

Insider and Institutional Ownership

0.0% of Zhongsheng Group shares are held by institutional investors. Comparatively, 88.6% of ACV Auctions shares are held by institutional investors. 8.5% of ACV Auctions shares are held 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 summary of current recommendations and price targets for Zhongsheng Group and ACV Auctions, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zhongsheng Group	0	0	0	0	N/A
ACV Auctions	0	2	6	0	2.75

ACV Auctions has a consensus price target of $22.00, indicating a potential upside of 22.77%. Given ACV Auctions’ higher probable upside, analysts plainly believe ACV Auctions is more favorable than Zhongsheng Group.

Valuation & Earnings

This table compares Zhongsheng Group and ACV Auctions”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zhongsheng Group	N/A	N/A	N/A	$5.36	2.87
ACV Auctions	$543.70 million	5.44	-$75.26 million	($0.48)	-37.33

Zhongsheng Group has higher earnings, but lower revenue than ACV Auctions. ACV Auctions is trading at a lower price-to-earnings ratio than Zhongsheng Group, indicating that it is currently the more affordable of the two stocks.

About Zhongsheng Group

Zhongsheng Group Holdings Limited, an investment holding company, engages in the sale and service of motor vehicles in the People's Republic of China. The company operates 4S dealerships for various automobile brands consisting of luxury automobile brands, including Mercedes-Benz, Lexus, BMW, Audi, Jaguar Land Rover, Porsche, and Volvo; and mid-to-high end automobile brands, such as Toyota, Honda, and Nissan. It also provides spare parts, automobile accessories, repair and maintenance services, detailing services, and other automobile-related products and services. The company was founded in 1998 and is headquartered in Dalian, the People's Republic of China.

About ACV Auctions

ACV Auctions Inc. operates a digital marketplace that connects buyers and sellers for the online auction of wholesale vehicles. The company’s marketplace platform includes digital marketplace, which connects buyers and sellers by providing online auction, which facilitates real-time transactions of wholesale vehicles; Run List for pre-filtering and pre-screening of vehicles up to 24 hours prior to an auction taking place; ACV transportation service to enable the buyers to see real-time transportation quotes and status reports of the vehicle; ACV capital, a short-term inventory financing services for buyers to purchase vehicles; and Go Green’s seller assurance service for against claims related to defects in the vehicle. It also provides remarketing centers, which offers value-added services, such as vehicle reconditioning and storage for dealers and commercial partners. In addition, the company offers data services, including True360 report, which provides cosmetic and structural vehicle assessments integrated into vehicle history reports for dealer to make wholesale and retail transaction decisions on and off the marketplace; ACV market report provides transaction data and condition reports for comparable used vehicles, including pricing data from third-party sources and allows dealers to determine pricing and valuation strategies for used vehicles; and ACV MAX inventory management software enables dealers to manage their inventory and set pricing while turning vehicles. Further, it provides data and technology through inspection, such as condition reports, virtual lift solutions, apex device, and vehicle intelligence platform; and marketplace enablement, comprising MyACV application, private marketplaces, operations automation, live appraisals, and programmatic buying service. ACV Auctions Inc. was incorporated in 2014 and is headquartered in Buffalo, New York.