Ermenegildo Zegna (NYSE:ZGN) & Kering (OTCMKTS:PPRUY) Head to Head Analysis

Ermenegildo Zegna (NYSE:ZGN) and Kering (OTCMKTS:PPRUY) are both retail/wholesale companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, dividends, analyst recommendations, institutional ownership and profitability.

Profitability

This table compares Ermenegildo Zegna and Kering’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ermenegildo Zegna	N/A	N/A	N/A
Kering	N/A	N/A	N/A

Insider & Institutional Ownership

12.9% of Ermenegildo Zegna shares are owned by institutional investors. Comparatively, 1.0% of Kering shares are owned by institutional investors. 1.2% of Ermenegildo Zegna 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.

Earnings and Valuation

This table compares Ermenegildo Zegna and Kering”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ermenegildo Zegna	$1.92 billion	2.92	$111.54 million	N/A	N/A
Kering	$16.60 billion	2.16	$81.46 million	N/A	N/A

Ermenegildo Zegna has higher earnings, but lower revenue than Kering.

Risk & Volatility

Ermenegildo Zegna has a beta of 0.82, meaning that its share price is 18% less volatile than the S&P 500. Comparatively, Kering has a beta of 1.29, meaning that its share price is 29% more volatile than the S&P 500.

Dividends

Ermenegildo Zegna pays an annual dividend of $0.12 per share and has a dividend yield of 0.9%. Kering pays an annual dividend of $0.16 per share and has a dividend yield of 0.6%. Ermenegildo Zegna has increased its dividend for 2 consecutive years. Ermenegildo Zegna is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of current ratings and recommmendations for Ermenegildo Zegna and Kering, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ermenegildo Zegna	0	4	4	0	2.50
Kering	3	4	2	0	1.89

Ermenegildo Zegna currently has a consensus price target of $12.26, indicating a potential downside of 7.14%. Given Ermenegildo Zegna’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Ermenegildo Zegna is more favorable than Kering.

Summary

Ermenegildo Zegna beats Kering on 9 of the 11 factors compared between the two stocks.

About Ermenegildo Zegna

Ermenegildo Zegna N.V., together with its subsidiaries, designs, manufactures, markets, and distributes luxury menswear, footwear, leather goods, and other accessories under the Zegna and the Thom Browne brands. It provides luxury leisurewear for men; formal suits, tuxedos, shirts, blazers, formal overcoats, and accessories; leather accessories comprising shoes, bags, belts, and small leather accessories; and fragrances. The company also offers luxury womenswear and childrenswear under the Thom Browne brand, as well as provides eyewear, cufflinks and jewelry, watches, underwear, and beachwear manufactured by third parties under licenses. It serves customers through its retail stores and online channels in Europe, the Middle East, Africa, North America, Latin America, the Asia Pacific, and internationally. The company was founded in 1910 and is based in Trivero, Italy. Ermenegildo Zegna N.V. operates as a subsidiary of Monterubello Societa’ Semplice.

About Kering

Kering SA manages the development of a series of renowned houses in fashion, leather goods and jewelry in France, the Asia-Pacific, Western Europe, North America, Japan, and internationally. The company offers ready-to-wear products apparel and accessories for men and women. It also offers leather goods and shoes; watches and jewelry; eyewear products; and fragrances and cosmetics. The company provides Gucci, Saint Laurent, Bottega Veneta, Balenciaga, Alexander McQueen, Brioni, Boucheron, Pomellato, DoDo, Qeelin, Ginori 1735, Kering Beauté, and Kering Eyewear brands. The company was formerly known as PPR SA and changed its name to Kering SA in June 2013. Kering SA was founded in 1963 and is based in Paris, France.