Lululemon Athletica inc. (NASDAQ: LULU) and Lakeland Industries (NASDAQ:LAKE) are both cyclical consumer goods & services companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, earnings, profitability, institutional ownership, valuation and risk.

Insider & Institutional Ownership

80.3% of Lululemon Athletica inc. shares are held by institutional investors. Comparatively, 44.2% of Lakeland Industries shares are held by institutional investors. 0.3% of Lululemon Athletica inc. shares are held by insiders. Comparatively, 7.8% of Lakeland Industries shares are held by 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.

Valuation & Earnings

This table compares Lululemon Athletica inc. and Lakeland Industries’ top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Lululemon Athletica inc. $2.44 billion 3.41 $519.98 million $2.08 29.57
Lakeland Industries $90.42 million 1.41 $10.08 million $0.82 19.33

Lululemon Athletica inc. has higher revenue and earnings than Lakeland Industries. Lakeland Industries is trading at a lower price-to-earnings ratio than Lululemon Athletica inc., indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Lululemon Athletica inc. has a beta of 0.2, meaning that its stock price is 80% less volatile than the S&P 500. Comparatively, Lakeland Industries has a beta of -0.06, meaning that its stock price is 106% less volatile than the S&P 500.

Profitability

This table compares Lululemon Athletica inc. and Lakeland Industries’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Lululemon Athletica inc. 8.38% 14.23% 11.85%
Lakeland Industries 6.65% 8.27% 7.02%

Analyst Recommendations

This is a summary of recent ratings and recommmendations for Lululemon Athletica inc. and Lakeland Industries, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Lululemon Athletica inc. 3 15 19 0 2.43
Lakeland Industries 0 0 1 0 3.00

Lululemon Athletica inc. presently has a consensus target price of $65.72, suggesting a potential upside of 6.85%. Lakeland Industries has a consensus target price of $18.00, suggesting a potential upside of 13.56%. Given Lakeland Industries’ stronger consensus rating and higher probable upside, analysts clearly believe Lakeland Industries is more favorable than Lululemon Athletica inc..

Summary

Lululemon Athletica inc. beats Lakeland Industries on 11 of the 14 factors compared between the two stocks.

Lululemon Athletica inc. Company Profile

lululemon athletica inc. is a designer, distributor and retailer of athletic apparel. The Company operates through two segments: Company-operated stores and Direct to consumer. It is also engaged in the sale from outlets, showrooms, sales from temporary locations, sales to wholesale accounts, warehouse sales, and license and supply arrangements. Its direct to consumer segment generates revenue from its lululemon and ivivva e-commerce Websites, www.lululemon.com and www.ivivva.com, and other country and region specific Websites. It offers a range of apparel and accessories for women, men and female youth. The Company’s apparel assortment includes items, such as pants, shorts, tops, and jackets designed for healthy lifestyle and athletic activities, such as yoga, running, training, most other sweaty pursuits, and athletic wear for female youth. The Company also offers fitness-related accessories, including an array of items, such as bags, socks, underwear, yoga mats and water bottles.

Lakeland Industries Company Profile

Lakeland Industries, Inc. (Lakeland) manufactures and sells a line of safety garments and accessories for the industrial and public protective clothing market. The Company’s product categories include limited use/disposable protective clothing; high-end chemical protective suits; firefighting, flame resistant personal protective equipment (FR PPE) and heat protective apparel; reusable woven garments; high visibility clothing, and glove and sleeves. The Company’s products are sold by its in-house customer service group, its regional sales managers and independent sales representatives to a network of over 1,200 North American safety and mill supply distributors. These distributors in turn supply end user industrial customers, such as integrated oil, chemical/petrochemical, utilities, automobile, steel, glass, construction, smelting, munition plants, janitorial, pharmaceutical, mortuaries and high technology electronics manufacturers, as well as scientific and medical laboratories.

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