Head to Head Analysis: Buckle (BKE) & Sequential Brands Group (SQBG)

Buckle (NYSE: BKE) and Sequential Brands Group (NASDAQ:SQBG) are both small-cap apparel & accessories retailers – nec companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, dividends, analyst recommendations, institutional ownership and profitability.

Analyst Ratings

This is a summary of current ratings and recommmendations for Buckle and Sequential Brands Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Buckle 1 0 0 0 1.00
Sequential Brands Group 0 4 3 0 2.43

Buckle currently has a consensus price target of $13.00, indicating a potential downside of 41.83%. Sequential Brands Group has a consensus price target of $6.92, indicating a potential upside of 256.53%. Given Sequential Brands Group’s stronger consensus rating and higher possible upside, analysts plainly believe Sequential Brands Group is more favorable than Buckle.

Profitability

This table compares Buckle and Sequential Brands Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Buckle 9.17% 19.13% 14.39%
Sequential Brands Group -14.35% 2.26% 0.85%

Dividends

Buckle pays an annual dividend of $1.00 per share and has a dividend yield of 4.5%. Sequential Brands Group does not pay a dividend. Buckle pays out 57.8% of its earnings in the form of a dividend. Sequential Brands Group has increased its dividend for 4 consecutive years.

Risk & Volatility

Buckle has a beta of 1.09, meaning that its share price is 9% more volatile than the S&P 500. Comparatively, Sequential Brands Group has a beta of 0.46, meaning that its share price is 54% less volatile than the S&P 500.

Insider & Institutional Ownership

59.7% of Buckle shares are owned by institutional investors. Comparatively, 50.3% of Sequential Brands Group shares are owned by institutional investors. 41.7% of Buckle shares are owned by company insiders. Comparatively, 27.3% of Sequential Brands Group shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Buckle and Sequential Brands Group’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Buckle $974.87 million 1.12 $97.96 million $1.73 12.92
Sequential Brands Group $155.53 million 0.79 -$820,000.00 ($0.38) -5.11

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

Summary

Buckle beats Sequential Brands Group on 12 of the 17 factors compared between the two stocks.

Buckle Company Profile

The Buckle, Inc. is a retailer of casual apparel, footwear and accessories for young men and women. As of January 28, 2017, the Company operated 467 retail stores in 44 states throughout the United States under the names Buckle and The Buckle. The Company markets a selection of brand name casual apparel, including denims, other casual bottoms, tops, sportswear, outerwear, accessories and footwear. The Company provides customer services, such as free hemming, free gift-wrapping, easy layaways, the Buckle private label credit card, and a guest loyalty program. The Company offers denims from brands, such as Miss Me, Rock Revival, Big Star Vintage, Buffalo Jeans, KanCan, Flying Monkey and Levi’s. Its other brands include Hurley, Billabong, Affliction, American Fighter, Fast & Furious, Oakley, Fox, Puma, Obey, RVCA, Salvage, 7 Diamonds, Nixon, Amuse Society, Free People, White Crow, Corral, Reef, Kustom, Timberland, UGG, TOMS, SAXX, Stance, Lokai, Ray-Ban, and Fossil.

Sequential Brands Group Company Profile

Sequential Brands Group, Inc. owns a portfolio of consumer brands in the fashion, home, athletic and lifestyle categories. The Company’s portfolio of consumer brands includes Martha Stewart, Emeril Lagasse, Jessica Simpson, Joe’s Jeans, William Rast, Ellen Tracy, Revo, AND1 and Avia. The Company’s brands are licensed for a range of product categories, including apparel, footwear, eyewear, fashion accessories and home goods. The Company licenses brands to both wholesale and direct-to-retail licensees. The Company licenses the Martha Stewart brand to various licensees, including retailers, such as Macy’s, The Home Depot, PetSmart and Staples. The Jessica Simpson Collection is a signature lifestyle concept designed in collaboration with Jessica Simpson, which offers various product categories, including footwear, apparel, fragrance, fashion accessories, maternity apparel, girls clothing and a home line. The Avia brand offers running and activewear products.

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