Analyzing Itochu (OTCMKTS:ITOCY) and Ollie’s Bargain Outlet (NASDAQ:OLLI)

Ollie’s Bargain Outlet (NASDAQ:OLLI) and Itochu (OTCMKTS:ITOCY) are both consumer discretionary companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, institutional ownership, profitability and dividends.

Valuation and Earnings

This table compares Ollie’s Bargain Outlet and Itochu”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ollie’s Bargain Outlet	$2.65 billion	2.08	$240.60 million	$4.48	20.68
Itochu	$98.47 billion	1.19	$5.63 billion	$0.93	15.89

Itochu has higher revenue and earnings than Ollie’s Bargain Outlet. Itochu is trading at a lower price-to-earnings ratio than Ollie’s Bargain Outlet, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Ollie’s Bargain Outlet has a beta of 0.41, meaning that its share price is 59% less volatile than the S&P 500. Comparatively, Itochu has a beta of 0.63, meaning that its share price is 37% less volatile than the S&P 500.

Institutional and Insider Ownership

0.1% of Itochu shares are held by institutional investors. 0.7% of Ollie’s Bargain Outlet shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and recommmendations for Ollie’s Bargain Outlet and Itochu, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ollie’s Bargain Outlet	0	4	13	0	2.76
Itochu	0	0	1	3	3.75

Ollie’s Bargain Outlet presently has a consensus target price of $103.50, suggesting a potential upside of 11.73%. Given Ollie’s Bargain Outlet’s higher possible upside, equities research analysts clearly believe Ollie’s Bargain Outlet is more favorable than Itochu.

Profitability

This table compares Ollie’s Bargain Outlet and Itochu’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ollie’s Bargain Outlet	9.79%	14.54%	9.23%
Itochu	N/A	N/A	N/A

Summary

Ollie’s Bargain Outlet beats Itochu on 8 of the 14 factors compared between the two stocks.

About Ollie’s Bargain Outlet

Ollie’s Bargain Outlet Holdings, Inc. is a holding company, which engages in the retail of closeouts, excess inventory, and salvage merchandise. It offers overstocks, package changes, manufacturer refurbished goods, and irregulars. The company’s products include housewares, food, books and stationery, bed and bath, floor coverings, electronics and toys. Ollie’s Bargain Outlet Holdings was founded by Mark Butler, Mort Bernstein, Oliver Rosenberg and Harry Coverman on July 29, 1982, and is headquartered in Harrisburg, PA.

About Itochu

ITOCHU Corporation engages in trading and importing/exporting various products worldwide. The company’s Textile segment produces and sells raw materials, threads, and textiles; and garments, home furnishings, and industrial materials, as well as trades in industrial textile and lifestyle products. Its Machinery segment engages in the plants, bridges, railways, and other infrastructure; power generation, transmission, transformation, and sale; water, environment and waste-related; ship trading; renewable and alternative energy; and waste recycling businesses. The company’s Metals & Minerals segment engages in development of metal and mineral resource; processing and steel products; trading of iron ore, coal, pig iron and ferrous raw materials, non-ferrous and light metals, steel products, nuclear fuels, and greenhouse gas emissions; and recycling and waste treatment activities. Its Energy & Chemicals segment trades in crude oil, petroleum products, LPG, LNG, natural gas, hydrogen, organic and inorganic chemicals, functional food, synthetic resins, packaging materials, household goods, fine chemicals, pharmaceuticals, and electronic materials, as well as engages in the solar and biomass power generation, electricity trading, and the energy storage cell businesses. The company’s Food segment produces, distributes, and retails food products. Its General Products & Realty segment produces and sells paper, pulp, natural rubber, tire, and wood products and materials; develops and operates real estate properties, such as housing, logistics facilities, and other projects; and offers logistics services. The company’s ICT & Financial Business segment offers IT, Internet related and venture capital, mobile telephone equipment, BPO, broadcasting and communications, entertainment and content, healthcare and preventive medicine outsourcing, and financial and insurance brokerage services. The company was founded in 1858 and is headquartered in Tokyo, Japan.