Head to Head Contrast: Children’s Place (NASDAQ:PLCE) & Capri (NYSE:CPRI)

Capri (NYSE:CPRI) and Children’s Place (NASDAQ:PLCE) are both retail/wholesale companies, but which is the superior business? We will compare the two companies based on the strength of their valuation, analyst recommendations, risk, dividends, earnings, institutional ownership and profitability.

Risk and Volatility

Capri has a beta of 1.45, indicating that its stock price is 45% more volatile than the S&P 500. Comparatively, Children’s Place has a beta of 1.97, indicating that its stock price is 97% more volatile than the S&P 500.

Profitability

This table compares Capri and Children’s Place’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Capri	-13.57%	-430.23%	-8.70%
Children’s Place	-4.01%	N/A	-6.44%

Insider and Institutional Ownership

84.3% of Capri shares are owned by institutional investors. 2.3% of Capri shares are owned by company insiders. Comparatively, 0.6% of Children’s Place shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations for Capri and Children’s Place, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Capri	1	7	6	1	2.47
Children’s Place	1	1	0	0	1.50

Capri currently has a consensus price target of $26.46, indicating a potential upside of 29.97%. Children’s Place has a consensus price target of $4.50, indicating a potential upside of 3.45%. Given Capri’s stronger consensus rating and higher probable upside, analysts clearly believe Capri is more favorable than Children’s Place.

Earnings & Valuation

This table compares Capri and Children’s Place”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Capri	$4.44 billion	0.55	-$1.18 billion	($4.26)	-4.78
Children’s Place	$1.39 billion	0.07	-$57.82 million	($2.62)	-1.66

Children’s Place has lower revenue, but higher earnings than Capri. Capri is trading at a lower price-to-earnings ratio than Children’s Place, indicating that it is currently the more affordable of the two stocks.

Summary

Capri beats Children’s Place on 8 of the 15 factors compared between the two stocks.

About Capri

Capri Holdings Limited designs, markets, distributes, and retails branded women's and men's apparel, footwear, and accessories in the United States, Canada, Latin America, Europe, the Middle East, Africa, and Asia. It operates through three segments: Versace, Jimmy Choo, and Michael Kors. The company offers ready-to-wear, accessories, footwear, handbags, scarves and belts, small leather goods, eyewear, watches, jewelry, fragrances, and home furnishings through a distribution network, including boutiques, department, and specialty stores, as well as through e-commerce sites. It also engages in licensing agreements to the manufacture and sale of watches, jewelry, eyewear, and fragrances. The company was formerly known as Michael Kors Holdings Limited and changed its name to Capri Holdings Limited in December 2018. Capri Holdings Limited was founded in 1981 and is headquartered in London, the United Kingdom.

About Children’s Place

The Children’s Place, Inc. engages in the provision of apparel, footwear, accessories, and other items for children. The firm also designs contracts to manufacture and sell fashionable and value-priced merchandise under the brand names of The Children’s Place, Baby Place, and Gymboree. It operates through The Children’s Place U.S. and The Children’s Place International segments. The Children’s Place U.S. segment refers to the company’s U.S. and Puerto Rico-based stores and revenue from its U.S. based wholesale business. The Children’s Place International segment is involved in the Canadian-based stores, revenue from the company’s Canadian-based wholesale business, as well as revenue from international franchisees. The company was founded by David Pulver and Clinton A. Clark in 1969 and is headquartered in Secaucus, NJ.