Iconix Brand Group (NASDAQ: ICON) and Hanesbrands (NYSE:HBI) are both consumer discretionary companies, but which is the superior stock? We will compare the two companies based on the strength of their dividends, analyst recommendations, profitability, valuation, earnings, risk and institutional ownership.

Valuation & Earnings

This table compares Iconix Brand Group and Hanesbrands’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Iconix Brand Group $352.95 million 0.81 $156.87 million ($4.42) -1.13
Hanesbrands $6.36 billion 1.35 $1.05 billion $1.52 15.48

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

Dividends

Hanesbrands pays an annual dividend of $0.60 per share and has a dividend yield of 2.5%. Iconix Brand Group does not pay a dividend. Hanesbrands pays out 39.5% of its earnings in the form of a dividend. Iconix Brand Group has raised its dividend for 3 consecutive years.

Risk and Volatility

Iconix Brand Group has a beta of 1.41, meaning that its stock price is 41% more volatile than the S&P 500. Comparatively, Hanesbrands has a beta of 0.73, meaning that its stock price is 27% less volatile than the S&P 500.

Institutional & Insider Ownership

83.6% of Iconix Brand Group shares are held by institutional investors. Comparatively, 94.5% of Hanesbrands shares are held by institutional investors. 1.3% of Iconix Brand Group shares are held by company insiders. Comparatively, 1.1% of Hanesbrands shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Iconix Brand Group and Hanesbrands’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Iconix Brand Group -82.22% 10.38% 3.02%
Hanesbrands 9.02% 64.80% 10.11%

Analyst Ratings

This is a summary of recent recommendations and price targets for Iconix Brand Group and Hanesbrands, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Iconix Brand Group 0 2 2 0 2.50
Hanesbrands 0 4 7 0 2.64

Iconix Brand Group presently has a consensus target price of $10.17, suggesting a potential upside of 103.33%. Hanesbrands has a consensus target price of $27.80, suggesting a potential upside of 18.15%. Given Iconix Brand Group’s higher probable upside, equities analysts plainly believe Iconix Brand Group is more favorable than Hanesbrands.

Summary

Hanesbrands beats Iconix Brand Group on 12 of the 17 factors compared between the two stocks.

Iconix Brand Group Company Profile

Iconix Brand Group, Inc. is a brand management company. As of December 31, 2016, the Company owned a portfolio of over 30 global consumer brands across women’s, men’s, and home categories. The Company operates through segments: men’s, women’s, home and international. The Company’s brand portfolio includes brands, such as Candie’s, Bongo, Joe Boxer, Rampage, Mudd, London Fog, Mossimo, Ocean Pacific/OP, Danskin/Danskin Now, Rocawear/Roc Nation, Cannon, Royal Velvet, Fieldcrest, Charisma, Starter, Waverly, Ecko Unltd/Mark Ecko Cut & Sew, Zoo York, Sharper Image, Umbro, Lee Cooper and Artful Dodger, and interests in Material Girl, Ed Hardy, Truth or Dare, Modern Amusement, Buffalo, Nick Graham Hydraulic and PONY brands. It operates in various geographic regions, including the United States, Japan and Other (which principally represent Latin America and Europe).

Hanesbrands Company Profile

Hanesbrands Inc. is a marketer of basic innerwear and activewear apparel in the Americas, Europe, Australia and Asia/Pacific under apparel brands, such as Hanes, Champion, Maidenform, DIM, Bali, Playtex, Bonds, JMS/Just My Size, Nur Die/Nur Der, L’eggs, Lovable, Wonderbra, Flexees, Gear for Sports and Berlei. The Company operates through four segments: Innerwear, Activewear, Direct to Consumer and International. The Innerwear segment focuses on core apparel products, such as intimate apparel, men’s underwear, women’s panties, children’s underwear, socks and hosiery. The Company operates in the activewear market through its Champion, Hanes and JMS/Just My Size brands. The Direct to Consumer segment operations include its domestic Company-operated outlet stores and Website operations that sell its branded products directly to consumers in the United States. The International segment includes products that primarily span across the innerwear and activewear segments.

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