Contrasting Ann (ANN) & Chico’s FAS (CHS)

Chico’s FAS (NYSE: CHS) and Ann (NYSE:ANN) are both retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their valuation, earnings, analyst recommendations, institutional ownership, risk, profitabiliy and dividends.

Insider and Institutional Ownership

95.6% of Chico’s FAS shares are held by institutional investors. 1.8% of Chico’s FAS shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations and price targets for Chico’s FAS and Ann, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Chico’s FAS 0 9 5 0 2.36
Ann 0 0 0 0 N/A

Chico’s FAS presently has a consensus target price of $13.58, suggesting a potential upside of 50.26%. Given Chico’s FAS’s higher possible upside, analysts clearly believe Chico’s FAS is more favorable than Ann.

Dividends

Chico’s FAS pays an annual dividend of $0.33 per share and has a dividend yield of 3.7%. Ann does not pay a dividend. Chico’s FAS pays out 46.5% of its earnings in the form of a dividend. Ann has raised its dividend for 7 consecutive years.

Earnings and Valuation

This table compares Chico’s FAS and Ann’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Chico’s FAS $2.42 billion 0.47 $281.35 million $0.71 12.73
Ann N/A N/A N/A N/A N/A

Chico’s FAS has higher revenue and earnings than Ann.

Profitability

This table compares Chico’s FAS and Ann’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Chico’s FAS 3.86% 17.36% 9.57%
Ann 2.27% 10.25% 5.10%

Summary

Chico’s FAS beats Ann on 9 of the 12 factors compared between the two stocks.

About Chico’s FAS

Chico’s FAS, Inc. is an omni-channel specialty retailer of women’s private branded, casual-to-dressy clothing, intimates and accessories, operating under the Chico’s, White House Black Market (WHBM) and Soma brand names. The Company is also engaged in the sale of merchandise in its domestic and international retail stores. The Chico’s brand sells private branded clothing focusing on women 45 and older. Chico’s apparel includes the Black Label, Zenergy and Travelers collections. The WHBM brand sells private branded clothing focusing on women 35 and older. WHBM sells clothing and accessory items, including everyday basics, wear-to-work, denim and occasion. It offers black and white color palette. The accessories at WHBM include shoes, belts, scarves, handbags and jewelry. The Soma brand sells private branded lingerie, sleepwear, loungewear, activewear and beauty products focusing on women 35 and older. The lingerie category includes bras, panties, shapewear and swimwear.

About Ann

ANN INC., through its wholly owned subsidiaries, is a specialty retailer of women’s apparel, shoes and accessories sold primarily under the Ann Taylor and LOFT brands. The Company operates in four segments: Ann Taylor, LOFT, Ann Taylor Factory and LOFT Outlet. The Company operates approximately 1,030 retail stores in 47 states of the United States, the District of Columbia, Puerto Rico and Canada, comprising 245 Ann Taylor stores, 537 LOFT stores, 116 Ann Taylor Factory stores, 127 LOFT Outlet stores and five Lou & Grey stores. In addition, the Company’s clients shop online in over 100 countries across the world at www.anntaylor.com and www.LOFT.com, and at three LOFT franchise locations in Mexico. The Company’s wholly owned subsidiary, AnnTaylor Distribution Services, Inc., owns its 256,000 square foot distribution center located in Louisville, Kentucky. The distribution center is located on approximately 29 acres.

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