Comparing Boot Barn Holdings (NYSE:BOOT) & DSW (DSW)

Boot Barn Holdings (NYSE: BOOT) and DSW (NYSE:DSW) are both small-cap retail/wholesale companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, profitability, dividends, institutional ownership, valuation, analyst recommendations and earnings.

Valuation and Earnings

This table compares Boot Barn Holdings and DSW’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Boot Barn Holdings $635.78 million 0.34 $56.20 million $0.54 14.94
DSW $2.72 billion 0.47 $263.39 million $1.43 11.08

DSW has higher revenue and earnings than Boot Barn Holdings. DSW is trading at a lower price-to-earnings ratio than Boot Barn Holdings, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations and price targets for Boot Barn Holdings and DSW, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Boot Barn Holdings 0 2 5 0 2.71
DSW 0 12 4 0 2.25

Boot Barn Holdings presently has a consensus target price of $10.43, suggesting a potential upside of 29.23%. DSW has a consensus target price of $20.88, suggesting a potential upside of 31.85%. Given DSW’s higher probable upside, analysts clearly believe DSW is more favorable than Boot Barn Holdings.

Institutional and Insider Ownership

83.6% of DSW shares are owned by institutional investors. 4.6% of Boot Barn Holdings shares are owned by company insiders. Comparatively, 20.4% of DSW shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Boot Barn Holdings and DSW’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Boot Barn Holdings 2.26% 8.58% 2.66%
DSW 4.32% 12.06% 7.81%

Volatility and Risk

Boot Barn Holdings has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500. Comparatively, DSW has a beta of 0.83, meaning that its share price is 17% less volatile than the S&P 500.

Dividends

DSW pays an annual dividend of $0.80 per share and has a dividend yield of 5.1%. Boot Barn Holdings does not pay a dividend. DSW pays out 55.9% of its earnings in the form of a dividend.

Summary

DSW beats Boot Barn Holdings on 11 of the 16 factors compared between the two stocks.

Boot Barn Holdings Company Profile

Boot Barn Holdings, Inc. is a lifestyle retailer of western and work-related footwear, apparel and accessories for men, women and children. The Company’s stores are located in or near neighborhood shopping centers with trade areas of approximately five or more miles, and it has opened stores in malls and outlet center locations. The Company’s stores average an area of approximately 11,490 square feet and feature an assortment of brands and styles. It also carries assortments of denim, western shirts, cowboy hats, belts and belt buckles, western-style jewelry and accessories. The Company’s western assortment includes various brands, such as Ariat, Dan Post, Justin, Levi Strauss, Lucchese, Miss Me, Montana Silversmiths, Resistol and Wrangler. Its work assortment includes rugged footwear, outerwear, overalls, denim and shirts. Its other brands include Carhartt, Georgia, Timberland Pro and Wolverine. As of March 26, 2016, the Company operated 208 stores in 29 states.

DSW Company Profile

DSW Inc. is a footwear retailer. The Company offers an assortment of brand name dress, casual and athletic footwear and accessories for women, men and kids. The Company operates through two segments: the DSW segment (DSW), which includes DSW stores and dsw.com, and the Affiliated Business Group (ABG) segment. As of January 28, 2017, the Company operated 501 DSW stores, dsw.com and shoe departments in 288 Stein Mart stores and Steinmart.com, 106 Gordmans stores and Gordmans.com, and one Frugal Fannie’s store. DSW separates its merchandise into three primary categories: women’s footwear; men’s footwear, and accessories and other (which includes kids’ footwear). Other primarily includes Ebuys and its investment in Town Shoes. The ABG segment partners with three other retailers to help build and optimize their in-store and online footwear businesses.

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