Tilly’s (NYSE: TLYS) and Francesca’s Holdings Corporation (NASDAQ:FRAN) are both retail/wholesale companies, but which is the superior stock? We will contrast the two businesses based on the strength of their institutional ownership, risk, valuation, dividends, analyst recommendations, profitability and earnings.

Earnings & Valuation

This table compares Tilly’s and Francesca’s Holdings Corporation’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Tilly’s $568.95 million 0.60 $11.41 million $0.41 28.98
Francesca’s Holdings Corporation $487.19 million 0.49 $42.00 million $0.97 6.73

Francesca’s Holdings Corporation has higher revenue, but lower earnings than Tilly’s. Francesca’s Holdings Corporation is trading at a lower price-to-earnings ratio than Tilly’s, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

40.7% of Tilly’s shares are owned by institutional investors. 50.1% of Tilly’s shares are owned by insiders. Comparatively, 1.2% of Francesca’s Holdings Corporation shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Tilly’s and Francesca’s Holdings Corporation’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tilly’s 2.09% 8.85% 5.50%
Francesca’s Holdings Corporation 7.28% 31.88% 18.83%

Analyst Ratings

This is a summary of recent ratings and price targets for Tilly’s and Francesca’s Holdings Corporation, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tilly’s 0 2 2 0 2.50
Francesca’s Holdings Corporation 0 6 2 0 2.25

Tilly’s presently has a consensus target price of $11.50, suggesting a potential downside of 3.20%. Francesca’s Holdings Corporation has a consensus target price of $13.86, suggesting a potential upside of 112.21%. Given Francesca’s Holdings Corporation’s higher possible upside, analysts plainly believe Francesca’s Holdings Corporation is more favorable than Tilly’s.

Volatility and Risk

Tilly’s has a beta of -0.55, indicating that its stock price is 155% less volatile than the S&P 500. Comparatively, Francesca’s Holdings Corporation has a beta of 0.18, indicating that its stock price is 82% less volatile than the S&P 500.

Summary

Francesca’s Holdings Corporation beats Tilly’s on 7 of the 13 factors compared between the two stocks.

About Tilly’s

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.

About Francesca’s Holdings Corporation

Francesca’s Holdings Corporation is a holding company. The Company is a specialty retailer, which operates a chain of boutiques across the United States. The Company offers a mix of apparel, jewelry, accessories and gifts. As of January 28, 2017, the Company operated 671 boutiques in 48 states and the District of Columbia, and also served its customers through www.francescas.com, its e-commerce Website. The Company offers apparel, such as dresses, fashion tops, sweaters, cardigans and wraps, bottoms, outerwear and jackets, tees and tanks, and intimates. The Company provides jewelry, such as necklaces, earrings, bracelets and rings. The Company offers accessories, such as handbags, clutches, wallets, shoes, belts, hats, scarves, sunglasses, watches and hair accessories. The Company provides gifts, such as fragrance, candles, bath and body, home accessories, books, wall art, nail polish and miscellaneous items. The Company operates its boutiques under the francesca’s brand.

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