Lands’ End (NASDAQ: LE) and Urban Outfitters (NASDAQ:URBN) are both retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their analyst recommendations, dividends, earnings, profitability, valuation, institutional ownership and risk.

Analyst Recommendations

This is a summary of current ratings for Lands’ End and Urban Outfitters, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Lands’ End 0 2 0 0 2.00
Urban Outfitters 2 17 6 0 2.16

Lands’ End presently has a consensus target price of $15.00, suggesting a potential upside of 26.05%. Urban Outfitters has a consensus target price of $21.95, suggesting a potential downside of 3.54%. Given Lands’ End’s higher possible upside, equities analysts plainly believe Lands’ End is more favorable than Urban Outfitters.

Insider & Institutional Ownership

60.5% of Lands’ End shares are owned by institutional investors. Comparatively, 87.7% of Urban Outfitters shares are owned by institutional investors. 0.5% of Lands’ End shares are owned by insiders. Comparatively, 26.3% of Urban Outfitters shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Lands’ End and Urban Outfitters’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Lands’ End -8.48% -0.73% -0.19%
Urban Outfitters 4.92% 13.61% 9.27%

Earnings & Valuation

This table compares Lands’ End and Urban Outfitters’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Lands’ End $1.34 billion 0.29 $39.65 million ($3.55) -3.35
Urban Outfitters $3.53 billion 0.72 $407.95 million $1.49 15.28

Urban Outfitters has higher revenue and earnings than Lands’ End. Lands’ End is trading at a lower price-to-earnings ratio than Urban Outfitters, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Lands’ End has a beta of 0.3, meaning that its share price is 70% less volatile than the S&P 500. Comparatively, Urban Outfitters has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500.

Summary

Urban Outfitters beats Lands’ End on 12 of the 13 factors compared between the two stocks.

About Lands’ End

Lands’ End, Inc. (Lands’ End) is a multi-channel retailer of casual clothing, accessories and footwear, as well as home products. The Company operates through two segments: Direct and Retail. The Company offers products through catalogs, online at www.landsend.com. The Direct segment sells products through the Company’s e-commerce Websites, international Websites and direct mail catalogs. The Retail segment sells products and services through Lands’ End Shops at Sears across the United States, the Company’s standalone Lands’ End Inlet stores and international shop-in-shops. The Company’s product categories include Apparel and Non-apparel. The Non-apparel category offers accessories, footwear and home goods. The Company provides embroidery, monogramming, gift wrapping, shipping and other services. In addition, the Company offers sheets and pillowcases, duvet covers and comforters, blankets and throws, mattress pads, towels, rugs and mats, school uniforms and shower curtains.

About Urban Outfitters

Urban Outfitters, Inc. is a lifestyle specialty retail company. The Company operates through two segments: Retail and Wholesale. The Company’s Retail segment consists of its Urban Outfitters, Anthropologie, Free People, Terrain and Bhldn brands, whose merchandise is sold to its customers through retail stores, Websites, mobile applications, catalogs and customer contact centers. The Retail segment also includes Vetri Family, which operates restaurants under the names Amis, Alla Spina, Lo Spiedo, Pizzeria Vetri and Osteria. Its Wholesale segment consists of the Free People wholesale division that primarily designs, develops and markets young women’s contemporary casual apparel and shoes through individual and chain specialty stores and department stores. The Company’s Wholesale segment includes Free People-branded tops, bottoms, sweaters, dresses, intimates, shoes and activewear, which are sold through department and specialty stores around the world, and its Free People stores.

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