Comparing Differential Brands Group (DFBG) & Iconix Brand Group (NASDAQ:ICON)

Differential Brands Group (NASDAQ: DFBG) and Iconix Brand Group (NASDAQ:ICON) are both small-cap consumer discretionary companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, profitability, risk, analyst recommendations, dividends, institutional ownership and valuation.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Differential Brands Group and Iconix Brand Group, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Differential Brands Group 0 0 1 0 3.00
Iconix Brand Group 0 2 2 0 2.50

Differential Brands Group currently has a consensus target price of $5.00, suggesting a potential upside of 177.78%. Iconix Brand Group has a consensus target price of $10.17, suggesting a potential upside of 103.33%. Given Differential Brands Group’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Differential Brands Group is more favorable than Iconix Brand Group.

Valuation & Earnings

This table compares Differential Brands Group and Iconix Brand Group’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Differential Brands Group $159.73 million 0.15 $4.56 million ($1.07) -1.68
Iconix Brand Group $352.95 million 0.81 $156.87 million ($4.42) -1.13

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

Profitability

This table compares Differential Brands Group and Iconix Brand Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Differential Brands Group -8.85% -29.02% -7.53%
Iconix Brand Group -82.22% 10.38% 3.02%

Insider and Institutional Ownership

1.7% of Differential Brands Group shares are owned by institutional investors. Comparatively, 83.6% of Iconix Brand Group shares are owned by institutional investors. 62.5% of Differential Brands Group shares are owned by company insiders. Comparatively, 1.3% of Iconix Brand Group shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Risk and Volatility

Differential Brands Group has a beta of -1.72, indicating that its stock price is 272% less volatile than the S&P 500. Comparatively, Iconix Brand Group has a beta of 1.41, indicating that its stock price is 41% more volatile than the S&P 500.

Summary

Iconix Brand Group beats Differential Brands Group on 8 of the 13 factors compared between the two stocks.

Differential Brands Group Company Profile

Differential Brands Group Inc., formerly Joe’s Jeans Inc., is engaged in the design, development and marketing of apparel products, which include denim jeans, related casual wear and accessories. The Company offers its products under various brands, such as Hudson, Robert Graham and SWIMS. Its segments are Wholesale and Retail. Its Wholesale segment consists of sales of Hudson products to retailers, specialty stores and international distributors. Its Retail segment consists of sales of its products to consumers through its retail Internet sites for Hudson products. The Hudson product line includes women’s, men’s and children’s denim jeans, pants and other bottoms. The Robert Graham product line includes men’s sport shirts, pants, sweaters, knits, t-shirts, sportcoats, outerwear and swimwear. Through SWIMS brand, it distributes a range of footwear, swimwear, outerwear, ready-to-wear and accessories across the world through department stores, independent specialty and luxury resorts.

Iconix Brand Group Company Profile

Iconix Brand Group, Inc. is a brand management company. As of December 31, 2016, the Company owned a portfolio of over 30 global consumer brands across women’s, men’s, and home categories. The Company operates through segments: men’s, women’s, home and international. The Company’s brand portfolio includes brands, such as Candie’s, Bongo, Joe Boxer, Rampage, Mudd, London Fog, Mossimo, Ocean Pacific/OP, Danskin/Danskin Now, Rocawear/Roc Nation, Cannon, Royal Velvet, Fieldcrest, Charisma, Starter, Waverly, Ecko Unltd/Mark Ecko Cut & Sew, Zoo York, Sharper Image, Umbro, Lee Cooper and Artful Dodger, and interests in Material Girl, Ed Hardy, Truth or Dare, Modern Amusement, Buffalo, Nick Graham Hydraulic and PONY brands. It operates in various geographic regions, including the United States, Japan and Other (which principally represent Latin America and Europe).

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