Urban Outfitters (NASDAQ: URBN) and Tilly's (NYSE:TLYS) are both retail/wholesale companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, earnings, institutional ownership, risk, profitability, valuation and analyst recommendations.

Volatility and Risk

Urban Outfitters has a beta of 0.59, indicating that its stock price is 41% less volatile than the S&P 500. Comparatively, Tilly's has a beta of -0.47, indicating that its stock price is 147% less volatile than the S&P 500.

Profitability

This table compares Urban Outfitters and Tilly's’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Urban Outfitters 4.92% 13.61% 9.27%
Tilly's -0.43% -1.41% -0.85%

Earnings and Valuation

This table compares Urban Outfitters and Tilly's’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Urban Outfitters $3.53 billion 0.79 $407.95 million $1.49 16.04
Tilly's $572.08 million 0.60 $50.50 million $0.41 29.24

Urban Outfitters has higher revenue and earnings than Tilly's. Urban Outfitters is trading at a lower price-to-earnings ratio than Tilly's, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

87.6% of Urban Outfitters shares are held by institutional investors. Comparatively, 40.3% of Tilly's shares are held by institutional investors. 26.3% of Urban Outfitters shares are held by company insiders. Comparatively, 53.4% of Tilly's shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations for Urban Outfitters and Tilly's, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Urban Outfitters 2 17 6 0 2.16
Tilly's 0 2 2 0 2.50

Urban Outfitters currently has a consensus price target of $21.95, suggesting a potential downside of 8.14%. Tilly's has a consensus price target of $11.50, suggesting a potential downside of 4.09%. Given Tilly's’ stronger consensus rating and higher possible upside, analysts clearly believe Tilly's is more favorable than Urban Outfitters.

Summary

Urban Outfitters beats Tilly's on 10 of the 14 factors compared between the two stocks.

About Urban Outfitters

Urban Outfitters, Inc. is a lifestyle specialty retail company. The Company operates through two segments: Retail and Wholesale. The Company’s Retail segment consists of its Urban Outfitters, Anthropologie, Free People, Terrain and Bhldn brands, whose merchandise is sold to its customers through retail stores, Websites, mobile applications, catalogs and customer contact centers. The Retail segment also includes Vetri Family, which operates restaurants under the names Amis, Alla Spina, Lo Spiedo, Pizzeria Vetri and Osteria. Its Wholesale segment consists of the Free People wholesale division that primarily designs, develops and markets young women’s contemporary casual apparel and shoes through individual and chain specialty stores and department stores. The Company’s Wholesale segment includes Free People-branded tops, bottoms, sweaters, dresses, intimates, shoes and activewear, which are sold through department and specialty stores around the world, and its Free People stores.

About Tilly's

Tilly’s, Inc. is a destination specialty retailer of casual apparel, footwear and accessories for young men, young women, boys and girls. The Company offers an unparalleled selection of relevant brands, styles, colors, sizes and price points. The Company’s apparel merchandise includes branded, fashion and styles for tops, outerwear, bottoms and dresses. Its accessories merchandise includes backpacks, hats, sunglasses, headphones, handbags, watches, jewelry and others. The Company offers its products through stores and Website. The Company operates over 220 stores in approximately 30 states. The Company’s stores are located in malls, lifestyle centers, power centers, community centers, outlet centers and street-front locations. The Company also operates an e-commerce platform for desktop and mobile. The Company’s third-party brands include AYC, Adidas, Billabong, Converse, Hurley, Nixon, JanSport, LRG and Stance, among others.

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