Tilly’s (NYSE:TLYS) vs. Victoria’s Secret & Co. (NYSE:VSCO) Financial Contrast

Tilly’s (NYSE:TLYS) and Victoria’s Secret & Co. (NYSE:VSCO) are both retail/wholesale companies, but which is the superior investment? We will compare the two businesses based on the strength of their dividends, valuation, earnings, analyst recommendations, institutional ownership, profitability and risk.

Volatility & Risk

Tilly’s has a beta of 0.1, meaning that its stock price is 90% less volatile than the S&P 500. Comparatively, Victoria’s Secret & Co. has a beta of 2.18, meaning that its stock price is 118% more volatile than the S&P 500.

Profitability

This table compares Tilly’s and Victoria’s Secret & Co.’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tilly’s	-3.15%	-21.26%	-5.34%
Victoria’s Secret & Co.	2.45%	33.55%	5.14%

Analyst Recommendations

This is a breakdown of current ratings and price targets for Tilly’s and Victoria’s Secret & Co., as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tilly’s	1	3	0	0	1.75
Victoria’s Secret & Co.	0	5	7	1	2.69

Tilly’s currently has a consensus price target of $2.00, suggesting a potential downside of 48.39%. Victoria’s Secret & Co. has a consensus price target of $61.80, suggesting a potential upside of 32.92%. Given Victoria’s Secret & Co.’s stronger consensus rating and higher probable upside, analysts clearly believe Victoria’s Secret & Co. is more favorable than Tilly’s.

Valuation and Earnings

This table compares Tilly’s and Victoria’s Secret & Co.”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tilly’s	$553.59 million	0.21	-$17.45 million	($0.59)	-6.57
Victoria’s Secret & Co.	$6.55 billion	0.56	$161.00 million	$1.86	25.00

Victoria’s Secret & Co. has higher revenue and earnings than Tilly’s. Tilly’s is trading at a lower price-to-earnings ratio than Victoria’s Secret & Co., indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

76.4% of Tilly’s shares are held by institutional investors. Comparatively, 90.3% of Victoria’s Secret & Co. shares are held by institutional investors. 2.8% of Tilly’s shares are held by company insiders. Comparatively, 0.5% of Victoria’s Secret & Co. shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

Victoria’s Secret & Co. beats Tilly’s on 14 of the 15 factors compared between the two stocks.

About Tilly’s

Tilly’s, Inc. engages in the retail of casual apparel, footwear, and accessories. Its stores are located in retail centers, including malls, lifestyle centers, power centers, community centers, outlet centers, and street-front locations. The company was founded by Hezy Shaked and Tilly Levine in 1982 and is headquartered in Irvine, CA.

About Victoria’s Secret & Co.

Victoria’s Secret & Co. operates as a lingerie, clothing and beauty retailer. It offers bras, panties, lingerie, pajamas, sleep, sport and swim apparel, and beauty products. The company was founded in 1963 and is headquartered in Reynoldsburg, OH.