Foot Locker (NYSE: FL) and Kate Spade & Co (NYSE:KATE) are both mid-cap retail/wholesale companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, dividends, profitability, risk, valuation and analyst recommendations.
Volatility & Risk
Foot Locker has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500. Comparatively, Kate Spade & Co has a beta of 1.75, indicating that its share price is 75% more volatile than the S&P 500.
This is a breakdown of current recommendations for Foot Locker and Kate Spade & Co, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Kate Spade & Co||1||13||1||0||2.00|
Foot Locker currently has a consensus target price of $51.13, suggesting a potential upside of 18.05%. Kate Spade & Co has a consensus target price of $20.04, suggesting a potential upside of 8.39%. Given Foot Locker’s stronger consensus rating and higher possible upside, research analysts plainly believe Foot Locker is more favorable than Kate Spade & Co.
Foot Locker pays an annual dividend of $1.24 per share and has a dividend yield of 2.9%. Kate Spade & Co does not pay a dividend. Foot Locker pays out 31.2% of its earnings in the form of a dividend. Foot Locker has raised its dividend for 6 consecutive years.
Valuation & Earnings
This table compares Foot Locker and Kate Spade & Co’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Foot Locker||$7.77 billion||0.69||$664.00 million||$3.98||10.88|
|Kate Spade & Co||N/A||N/A||N/A||$1.10||16.81|
Foot Locker has higher revenue and earnings than Kate Spade & Co. Foot Locker is trading at a lower price-to-earnings ratio than Kate Spade & Co, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
88.2% of Foot Locker shares are owned by institutional investors. Comparatively, 97.9% of Kate Spade & Co shares are owned by institutional investors. 2.9% of Foot Locker shares are owned by insiders. Comparatively, 0.8% of Kate Spade & Co shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.
This table compares Foot Locker and Kate Spade & Co’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Kate Spade & Co||0.44%||1.11%||0.43%|
Foot Locker beats Kate Spade & Co on 11 of the 14 factors compared between the two stocks.
Foot Locker Company Profile
Foot Locker, Inc. is a retailer of shoes and apparel. The Company operates through two segments: Athletic Stores and Direct-to-Customers. The Company is an athletic footwear and apparel retailer, which include businesses, such as include Foot Locker, Kids Foot Locker, Lady Foot Locker, Champs Sports, Footaction, Runners Point, Sidestep and SIX:02. The Direct-to-Customers segment is multi-branded and sells directly to customers through Internet and mobile sites and catalogs. The Direct-to-Customers segment operates the Websites for eastbay.com, final-score.com, eastbayteamsales.com and sp24.com. Additionally, this segment includes the Websites, both desktop and mobile, aligned with the brand names of its store banners (footlocker.com, ladyfootlocker.com, six02.com kidsfootlocker.com, champssports.com, footaction.com, footlocker.ca, footlocker.eu, runnerspoint.com and sidestep-shoes.com).
Kate Spade & Co Company Profile
Kate Spade & Company is engaged in the design and marketing of a range of accessories and apparel. It operates through three segments. The KATE SPADE North America segment consists of the Company’s kate spade new york and JACK SPADE brands in North America. The KATE SPADE International segment consists of the Company’s kate spade new york and JACK SPADE brands in international markets, which operates principally in Japan, Asia (excluding Japan), Europe and Latin America). The Adelington Design Group segment primarily consists of exclusive arrangements to supply jewelry for the LIZ CLAIBORNE and MONET brands. In addition, the Adelington Design Group segment serves J.C. Penney Corporation, Inc. (JCPenney) through exclusive supplier agreements for the LIZ CLAIBORNE and MONET jewelry lines. As of December 31, 2016, it operated 98 the United States Specialty Retail Stores; 35 Foreign Specialty Retail Stores; 65 the United States Outlet Stores; 17 Foreign Outlet Stores, and 54 Concessions.
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