Financial Review: Ralph Lauren Corporation (RL) vs. Differential Brands Group (DFBG)
Ralph Lauren Corporation (NYSE: RL) and Differential Brands Group (NASDAQ:DFBG) are both consumer discretionary companies, but which is the superior stock? We will compare the two businesses based on the strength of their dividends, risk, analyst recommendations, profitability, institutional ownership, earnings and valuation.
Insider & Institutional Ownership
62.9% of Ralph Lauren Corporation shares are owned by institutional investors. Comparatively, 1.6% of Differential Brands Group shares are owned by institutional investors. 32.9% of Ralph Lauren Corporation shares are owned by insiders. Comparatively, 62.5% of Differential Brands Group shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
This is a summary of recent ratings and price targets for Ralph Lauren Corporation and Differential Brands Group, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Ralph Lauren Corporation||1||12||4||0||2.18|
|Differential Brands Group||0||0||2||0||3.00|
Ralph Lauren Corporation currently has a consensus price target of $83.17, indicating a potential downside of 8.40%. Differential Brands Group has a consensus price target of $5.00, indicating a potential upside of 212.50%. Given Differential Brands Group’s stronger consensus rating and higher possible upside, analysts plainly believe Differential Brands Group is more favorable than Ralph Lauren Corporation.
Valuation and Earnings
This table compares Ralph Lauren Corporation and Differential Brands Group’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Ralph Lauren Corporation||$6.45 billion||1.14||$987.10 million||($0.23)||-394.74|
|Differential Brands Group||$159.73 million||0.13||$4.56 million||($1.07)||-1.50|
Ralph Lauren Corporation has higher revenue and earnings than Differential Brands Group. Ralph Lauren Corporation is trading at a lower price-to-earnings ratio than Differential Brands Group, indicating that it is currently the more affordable of the two stocks.
Ralph Lauren Corporation pays an annual dividend of $2.00 per share and has a dividend yield of 2.2%. Differential Brands Group does not pay a dividend. Ralph Lauren Corporation pays out -869.6% of its earnings in the form of a dividend. Differential Brands Group has raised its dividend for 5 consecutive years.
This table compares Ralph Lauren Corporation and Differential Brands Group’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Ralph Lauren Corporation||-0.27%||13.80%||8.14%|
|Differential Brands Group||-8.85%||-29.02%||-7.53%|
Volatility & Risk
Ralph Lauren Corporation has a beta of 0.58, indicating that its stock price is 42% less volatile than the S&P 500. Comparatively, Differential Brands Group has a beta of -1.72, indicating that its stock price is 272% less volatile than the S&P 500.
Ralph Lauren Corporation beats Differential Brands Group on 12 of the 16 factors compared between the two stocks.
Ralph Lauren Corporation Company Profile
Ralph Lauren Corporation is engaged in the design, marketing and distribution of lifestyle products, including apparel, accessories, home furnishings and other licensed product categories. The Company operates through three segments: Wholesale, Retail and Licensing. Wholesale business consists of sales made to department stores and specialty stores around the world. Retail business consists of sales made directly to consumers through retail channel, which includes Company’s’ retail stores, concession-based shop-within-shops and e-commerce operations around the world. Licensing business consists of royalty-based arrangements, under which the Company licenses to unrelated third parties for specified periods the right to operate retail stores and/or to use its various trademarks in connection with the manufacture and sale of designated products, such as certain apparel, eyewear, fragrances and home furnishings.
Differential Brands Group Company Profile
Differential Brands Group Inc., formerly Joe’s Jeans Inc., is engaged in the design, development and marketing of apparel products, which include denim jeans, related casual wear and accessories. The Company offers its products under various brands, such as Hudson, Robert Graham and SWIMS. Its segments are Wholesale and Retail. Its Wholesale segment consists of sales of Hudson products to retailers, specialty stores and international distributors. Its Retail segment consists of sales of its products to consumers through its retail Internet sites for Hudson products. The Hudson product line includes women’s, men’s and children’s denim jeans, pants and other bottoms. The Robert Graham product line includes men’s sport shirts, pants, sweaters, knits, t-shirts, sportcoats, outerwear and swimwear. Through SWIMS brand, it distributes a range of footwear, swimwear, outerwear, ready-to-wear and accessories across the world through department stores, independent specialty and luxury resorts.
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