Francesca’s Holdings Corporation (NASDAQ: FRAN) and Abercrombie & Fitch (NYSE:ANF) are both small-cap consumer discretionary companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, earnings, analyst recommendations, institutional ownership, profitability, dividends and valuation.
Risk & Volatility
Francesca’s Holdings Corporation has a beta of 0.19, indicating that its stock price is 81% less volatile than the S&P 500. Comparatively, Abercrombie & Fitch has a beta of 0.76, indicating that its stock price is 24% less volatile than the S&P 500.
This is a summary of recent recommendations for Francesca’s Holdings Corporation and Abercrombie & Fitch, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Francesca’s Holdings Corporation||0||6||2||0||2.25|
|Abercrombie & Fitch||6||12||3||0||1.86|
Francesca’s Holdings Corporation presently has a consensus target price of $13.86, indicating a potential upside of 114.18%. Abercrombie & Fitch has a consensus target price of $11.94, indicating a potential downside of 11.11%. Given Francesca’s Holdings Corporation’s stronger consensus rating and higher probable upside, analysts clearly believe Francesca’s Holdings Corporation is more favorable than Abercrombie & Fitch.
Abercrombie & Fitch pays an annual dividend of $0.80 per share and has a dividend yield of 6.0%. Francesca’s Holdings Corporation does not pay a dividend. Abercrombie & Fitch pays out -258.1% of its earnings in the form of a dividend.
Institutional & Insider Ownership
98.4% of Abercrombie & Fitch shares are owned by institutional investors. 1.2% of Francesca’s Holdings Corporation shares are owned by company insiders. Comparatively, 0.6% of Abercrombie & Fitch shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Valuation & Earnings
This table compares Francesca’s Holdings Corporation and Abercrombie & Fitch’s revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Francesca’s Holdings Corporation||$493.21 million||0.48||$78.79 million||$0.97||6.67|
|Abercrombie & Fitch||$3.30 billion||0.28||$181.74 million||($0.31)||-43.32|
Abercrombie & Fitch has higher revenue and earnings than Francesca’s Holdings Corporation. Abercrombie & Fitch is trading at a lower price-to-earnings ratio than Francesca’s Holdings Corporation, indicating that it is currently the more affordable of the two stocks.
This table compares Francesca’s Holdings Corporation and Abercrombie & Fitch’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Francesca’s Holdings Corporation||7.28%||31.88%||18.83%|
|Abercrombie & Fitch||-0.62%||-0.79%||-0.42%|
Francesca’s Holdings Corporation beats Abercrombie & Fitch on 8 of the 15 factors compared between the two stocks.
Francesca’s Holdings Corporation Company Profile
Francesca’s Holdings Corporation is a holding company. The Company is a specialty retailer, which operates a chain of boutiques across the United States. The Company offers a mix of apparel, jewelry, accessories and gifts. As of January 28, 2017, the Company operated 671 boutiques in 48 states and the District of Columbia, and also served its customers through www.francescas.com, its e-commerce Website. The Company offers apparel, such as dresses, fashion tops, sweaters, cardigans and wraps, bottoms, outerwear and jackets, tees and tanks, and intimates. The Company provides jewelry, such as necklaces, earrings, bracelets and rings. The Company offers accessories, such as handbags, clutches, wallets, shoes, belts, hats, scarves, sunglasses, watches and hair accessories. The Company provides gifts, such as fragrance, candles, bath and body, home accessories, books, wall art, nail polish and miscellaneous items. The Company operates its boutiques under the francesca’s brand.
Abercrombie & Fitch Company Profile
Abercrombie & Fitch Co. is a specialty retailer who primarily sells its products through store and direct-to-consumer operations, as well as through various wholesale, franchise and licensing arrangements. The Company operates through two segments: Abercrombie, which includes the Company’s Abercrombie & Fitch and abercrombie kids brands, and Hollister, which includes the Company’s Hollister and Gilly Hicks brands. The Company offers an array of apparel products, including knit tops, woven shirts, graphic t-shirts, fleece, sweaters, jeans, woven pants, shorts, outerwear, dresses, intimates and swimwear, and personal care products and accessories for men, women and kids under the Abercrombie & Fitch, abercrombie kids, Hollister and Gilly Hicks brands. The Company has operations in North America, Europe, Asia and the Middle East. As of January 28, 2017, the Company operated 709 stores in the United States and 189 stores outside of the United States.
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