Guess? (NYSE: GES) and Kate Spade & Co (NYSE:KATE) are both consumer discretionary companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, valuation, institutional ownership, analyst recommendations, earnings, risk and profitability.

Insider and Institutional Ownership

77.9% of Guess? shares are held by institutional investors. Comparatively, 97.9% of Kate Spade & Co shares are held by institutional investors. 29.6% of Guess? shares are held by insiders. Comparatively, 0.8% of Kate Spade & Co shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares Guess? and Kate Spade & Co’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Guess? $2.21 billion 0.68 $22.76 million $0.11 163.18
Kate Spade & Co N/A N/A N/A $1.10 16.81

Guess? has higher revenue and earnings than Kate Spade & Co. Kate Spade & Co is trading at a lower price-to-earnings ratio than Guess?, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Guess? has a beta of 0.41, suggesting that its stock price is 59% less volatile than the S&P 500. Comparatively, Kate Spade & Co has a beta of 1.75, suggesting that its stock price is 75% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Guess? and Kate Spade & Co, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Guess? 1 4 4 0 2.33
Kate Spade & Co 1 13 1 0 2.00

Guess? presently has a consensus price target of $14.11, suggesting a potential downside of 21.37%. Kate Spade & Co has a consensus price target of $20.04, suggesting a potential upside of 8.39%. Given Kate Spade & Co’s higher possible upside, analysts clearly believe Kate Spade & Co is more favorable than Guess?.

Profitability

This table compares Guess? and Kate Spade & Co’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Guess? 0.43% 4.14% 2.62%
Kate Spade & Co 0.44% 1.11% 0.43%

Dividends

Guess? pays an annual dividend of $0.90 per share and has a dividend yield of 5.0%. Kate Spade & Co does not pay a dividend. Guess? pays out 818.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Guess? has raised its dividend for 3 consecutive years.

Summary

Guess? beats Kate Spade & Co on 8 of the 14 factors compared between the two stocks.

Guess? Company Profile

Guess?, Inc. designs, markets, distributes and licenses a lifestyle collections of apparel and accessories for men, women and children. The Company operates through five segments: Americas Retail, Europe, Asia, Americas Wholesale and Licensing. The Americas Retail segment includes the Company’s retail and e-commerce operations in North and Central America and its retail operations in South America. The Europe segment includes the Company’s retail, e-commerce and wholesale operations in Europe and the Middle East. The Asia segment includes the Company’s retail, e-commerce and wholesale operations in Asia. The Asia segment includes the Company’s retail, e-commerce and wholesale operations in Asia. The Licensing segment includes the around the world licensing operations of the Company. Its apparel is marketed under various names, including GUESS, GUESS?, GUESS U.S.A., GUESS Jeans, MARCIANO, Question Mark and Triangle Design, GUESS Kids, Baby GUESS, YES, G by GUESS and GUESS by MARCIANO.

Kate Spade & Co Company Profile

Kate Spade & Company is engaged in the design and marketing of a range of accessories and apparel. It operates through three segments. The KATE SPADE North America segment consists of the Company’s kate spade new york and JACK SPADE brands in North America. The KATE SPADE International segment consists of the Company’s kate spade new york and JACK SPADE brands in international markets, which operates principally in Japan, Asia (excluding Japan), Europe and Latin America). The Adelington Design Group segment primarily consists of exclusive arrangements to supply jewelry for the LIZ CLAIBORNE and MONET brands. In addition, the Adelington Design Group segment serves J.C. Penney Corporation, Inc. (JCPenney) through exclusive supplier agreements for the LIZ CLAIBORNE and MONET jewelry lines. As of December 31, 2016, it operated 98 the United States Specialty Retail Stores; 35 Foreign Specialty Retail Stores; 65 the United States Outlet Stores; 17 Foreign Outlet Stores, and 54 Concessions.

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