Tailored Brands (NYSE: TLRD) and Destination XL Group (NASDAQ:DXLG) are both small-cap cyclical consumer goods & services companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, analyst recommendations, dividends, risk, earnings, valuation and institutional ownership.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Tailored Brands and Destination XL Group, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tailored Brands 0 4 4 0 2.50
Destination XL Group 0 0 2 0 3.00

Tailored Brands presently has a consensus target price of $17.33, suggesting a potential upside of 6.93%. Destination XL Group has a consensus target price of $3.00, suggesting a potential upside of 53.85%. Given Destination XL Group’s stronger consensus rating and higher probable upside, analysts clearly believe Destination XL Group is more favorable than Tailored Brands.

Earnings and Valuation

This table compares Tailored Brands and Destination XL Group’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Tailored Brands $3.38 billion 0.24 $24.95 million $1.19 13.62
Destination XL Group $450.28 million 0.21 -$2.25 million ($0.28) -6.96

Tailored Brands has higher revenue and earnings than Destination XL Group. Destination XL Group is trading at a lower price-to-earnings ratio than Tailored Brands, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Tailored Brands has a beta of 1.87, suggesting that its stock price is 87% more volatile than the S&P 500. Comparatively, Destination XL Group has a beta of 0.5, suggesting that its stock price is 50% less volatile than the S&P 500.

Dividends

Tailored Brands pays an annual dividend of $0.72 per share and has a dividend yield of 4.4%. Destination XL Group does not pay a dividend. Tailored Brands pays out 60.5% of its earnings in the form of a dividend.

Insider & Institutional Ownership

77.8% of Destination XL Group shares are owned by institutional investors. 2.0% of Tailored Brands shares are owned by insiders. Comparatively, 31.5% of Destination XL Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares Tailored Brands and Destination XL Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tailored Brands 1.79% -108.13% 4.41%
Destination XL Group -3.01% -10.24% -3.05%

Summary

Tailored Brands beats Destination XL Group on 9 of the 15 factors compared between the two stocks.

About Tailored Brands

Tailored Brands, Inc. is a holding company of The Men’s Wearhouse, Inc. The Company is a specialty apparel retailer offering suits, suit separates, sport coats, slacks, business casual, sportswear, outerwear, dress shirts, shoes and accessories for men and tuxedo and suit rental product. It operates through two segments: Retail and Corporate Apparel. The Retail segment includes four retail merchandising brands: Men’s Wearhouse/Men’s Wearhouse and Tux, Jos. A. Bank, Moores, and K&G. Specialty apparel merchandise offered by its retail merchandising concepts include suits, suit separates, sport coats, business casual, sportswear, outerwear, dress shirts, shoes and accessories for men. Women’s career apparel, sportswear and accessories, such as shoes and children’s apparel are offered at its K&G stores. The Corporate Apparel segment includes corporate apparel and uniform operations conducted by Twin Hill in the United States and Dimensions, Alexandra and Yaffy in the United Kingdom.

About Destination XL Group

Destination XL Group, Inc. is a specialty retailer of men’s apparel with retail and direct operations in the United States and London, England. The Company operates through the Big & Tall Men’s Apparel segment. The Company operates under the trade names of Destination XL, DXL, Casual Male XL, Casual Male XL outlets, DXL outlets, Rochester Clothing, ShoesXL and LivingXL. The Company operates approximately 170 Destination XL stores, 125 Casual Male XL retail stores, 40 Casual Male XL outlet stores, nine DXL outlet stores and five Rochester Clothing stores. Its direct business includes its DestinationXL.com and bigandtall.com e-commerce sites, which support its stores, brands and product extensions. Through its multiple brands, which include both branded apparel and private-label, the Company offers a range of merchandise. The Company carries various designer brands, including Cole Haan, Allen Edmonds, Timberland, Calvin Klein, Lacoste, Donald J. Pliner and Bruno Magli.

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