Critical Review: Michael Kors Holdings Limited (KORS) & Tilly’s (NYSE:TLYS)
Michael Kors Holdings Limited (NYSE: KORS) and Tilly’s (NYSE:TLYS) are both consumer discretionary companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, profitabiliy, institutional ownership, risk, dividends, valuation and earnings.
Earnings and Valuation
This table compares Michael Kors Holdings Limited and Tilly’s’ top-line revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Michael Kors Holdings Limited||$4.49 billion||1.22||$1.12 billion||$3.25||10.82|
|Tilly’s||$569.68 million||0.50||$47.93 million||$0.48||20.65|
Michael Kors Holdings Limited has higher revenue and earnings than Tilly’s. Michael Kors Holdings Limited is trading at a lower price-to-earnings ratio than Tilly’s, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Michael Kors Holdings Limited has a beta of 0.1, suggesting that its share price is 90% less volatile than the S&P 500. Comparatively, Tilly’s has a beta of -0.42, suggesting that its share price is 142% less volatile than the S&P 500.
This table compares Michael Kors Holdings Limited and Tilly’s’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Michael Kors Holdings Limited||12.38%||41.00%||26.58%|
This is a summary of recent ratings and recommmendations for Michael Kors Holdings Limited and Tilly’s, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Michael Kors Holdings Limited||2||19||3||0||2.04|
Michael Kors Holdings Limited currently has a consensus price target of $38.76, indicating a potential upside of 10.18%. Tilly’s has a consensus price target of $10.83, indicating a potential upside of 9.32%. Given Michael Kors Holdings Limited’s higher probable upside, analysts clearly believe Michael Kors Holdings Limited is more favorable than Tilly’s.
Insider and Institutional Ownership
84.0% of Michael Kors Holdings Limited shares are held by institutional investors. Comparatively, 41.4% of Tilly’s shares are held by institutional investors. 6.0% of Michael Kors Holdings Limited shares are held by company insiders. Comparatively, 53.4% of Tilly’s shares are held 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.
Michael Kors Holdings Limited beats Tilly’s on 10 of the 13 factors compared between the two stocks.
About Michael Kors Holdings Limited
Michael Kors Holdings Limited is a designer, marketer, distributor and retailer of branded women’s apparel and accessories and men’s apparel bearing the Michael Kors tradename and related trademarks MICHAEL KORS, MICHAEL MICHAEL KORS, and various other related trademarks and logos. The Company operates through three segments: retail, wholesale and licensing. The Retail operations consist of collection stores and lifestyle stores, including concessions and outlet stores, located primarily in the Americas (the United States, Canada and Latin America), Europe and Asia, as well as e-commerce. Wholesale revenues are principally derived from major department and specialty stores located throughout the Americas, Europe and Asia. The Company licenses its trademarks on products, such as fragrances, beauty, eyewear, leather goods, jewelry, watches, coats, men’s suits, swimwear, furs and ties, as well as through geographic licenses.
Tilly’s, Inc. is a destination specialty retailer of casual apparel, footwear and accessories for young men, young women, boys and girls. The Company offers an unparalleled selection of relevant brands, styles, colors, sizes and price points. The Company’s apparel merchandise includes branded, fashion and styles for tops, outerwear, bottoms and dresses. Its accessories merchandise includes backpacks, hats, sunglasses, headphones, handbags, watches, jewelry and others. The Company offers its products through stores and Website. The Company operates over 220 stores in approximately 30 states. The Company’s stores are located in malls, lifestyle centers, power centers, community centers, outlet centers and street-front locations. The Company also operates an e-commerce platform for desktop and mobile. The Company’s third-party brands include AYC, Adidas, Billabong, Converse, Hurley, Nixon, JanSport, LRG and Stance, among others.
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