The Bon-Ton Stores (NASDAQ: BONT) and Kohl’s Corporation (NYSE:KSS) are both retail/wholesale companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, risk, profitabiliy, earnings, analyst recommendations, institutional ownership and valuation.

Analyst Ratings

This is a summary of current ratings and price targets for The Bon-Ton Stores and Kohl’s Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
The Bon-Ton Stores 0 0 0 0 N/A
Kohl’s Corporation 4 11 5 0 2.05

Kohl’s Corporation has a consensus target price of $43.22, suggesting a potential upside of 13.03%. Given Kohl’s Corporation’s higher possible upside, analysts clearly believe Kohl’s Corporation is more favorable than The Bon-Ton Stores.

Profitability

This table compares The Bon-Ton Stores and Kohl’s Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
The Bon-Ton Stores -3.17% N/A -4.25%
Kohl’s Corporation 3.25% 13.29% 5.02%

Dividends

Kohl’s Corporation pays an annual dividend of $2.20 per share and has a dividend yield of 5.8%. The Bon-Ton Stores does not pay a dividend. Kohl’s Corporation pays out 64.1% of its earnings in the form of a dividend. Kohl’s Corporation has raised its dividend for 6 consecutive years.

Volatility and Risk

The Bon-Ton Stores has a beta of 3.02, indicating that its share price is 202% more volatile than the S&P 500. Comparatively, Kohl’s Corporation has a beta of 1.15, indicating that its share price is 15% more volatile than the S&P 500.

Valuation and Earnings

This table compares The Bon-Ton Stores and Kohl’s Corporation’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
The Bon-Ton Stores $2.62 billion 0.00 $101.96 million ($4.30) -0.09
Kohl’s Corporation $18.56 billion 0.35 $2.33 billion $3.43 11.15

Kohl’s Corporation has higher revenue and earnings than The Bon-Ton Stores. The Bon-Ton Stores is trading at a lower price-to-earnings ratio than Kohl’s Corporation, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

23.9% of The Bon-Ton Stores shares are held by institutional investors. 45.7% of The Bon-Ton Stores shares are held by company insiders. Comparatively, 1.2% of Kohl’s Corporation shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Kohl’s Corporation beats The Bon-Ton Stores on 11 of the 15 factors compared between the two stocks.

The Bon-Ton Stores Company Profile

The Bon-Ton Stores, Inc. is a department store operator. The Company operates through two segments: stores and eCommerce (its Internet Websites). The Company offers a range of brand-name fashion apparel and accessories for women, men and children. It operates approximately 270 stores in over 26 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner’s, Boston Store, Carson’s, Elder-Beerman, Herberger’s and Younkers nameplates, encompassing a total of approximately 25 million square feet. Its nationally distributed brand assortment includes a range of labels in the apparel, accessories, footwear, cosmetics and home furnishings industries, such as Anne Klein, Calvin Klein, Carters, Chaps, Clarks, Clinique, Coach, Estee Lauder, Fossil, Free People, Frye, Jessica Simpson and Vince Camuto. Its private brand portfolio includes Laura Ashley, Ruff Hewn, Relativity and Casa by Victor Alfaro.

Kohl’s Corporation Company Profile

Kohl’s Corporation (Kohl’s) is an operator of department stores. The Company operates approximately 1,154 Kohl’s department stores, a Website (www.Kohls.com), approximately 12 FILA outlets, and approximately three Off-Aisle clearance centers. The Company’s stores and Website sell moderately-priced private label and national brand apparel, footwear, accessories, beauty and home products. The Company’s Website includes merchandise that is available in its stores, as well as merchandise that is available only online. The Company’s merchandise mix includes both national brands and private brands that are available only at Kohl’s. The Company’s private brands include Apt. 9, Croft & Barrow, Jumping Beans, SO and Sonoma Goods for Life. The Company’s exclusive brands include Food Network, Jennifer Lopez, Marc Anthony, Rock & Republic and Simply Vera Vera Wang.

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