At Home Group (NYSE: HOME) and Williams-Sonoma (NYSE:WSM) are both retail/wholesale companies, but which is the better investment? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, risk, dividends, profitability, institutional ownership and valuation.

Profitability

This table compares At Home Group and Williams-Sonoma’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
At Home Group 4.18% 7.53% 3.21%
Williams-Sonoma 5.94% 25.45% 12.35%

Volatility and Risk

At Home Group has a beta of 3.84, suggesting that its share price is 284% more volatile than the S&P 500. Comparatively, Williams-Sonoma has a beta of 0.89, suggesting that its share price is 11% less volatile than the S&P 500.

Insider & Institutional Ownership

24.8% of At Home Group shares are owned by institutional investors. Comparatively, 96.6% of Williams-Sonoma shares are owned by institutional investors. 7.3% of At Home Group shares are owned by insiders. Comparatively, 1.0% of Williams-Sonoma shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings & Valuation

This table compares At Home Group and Williams-Sonoma’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
At Home Group $765.64 million 2.08 $27.06 million $0.60 43.90
Williams-Sonoma $5.08 billion 0.89 $305.38 million $3.53 15.24

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

Analyst Ratings

This is a summary of recent ratings and recommmendations for At Home Group and Williams-Sonoma, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
At Home Group 0 2 5 0 2.71
Williams-Sonoma 5 15 3 0 1.91

At Home Group currently has a consensus price target of $27.50, suggesting a potential upside of 4.40%. Williams-Sonoma has a consensus price target of $50.78, suggesting a potential downside of 5.62%. Given At Home Group’s stronger consensus rating and higher possible upside, analysts plainly believe At Home Group is more favorable than Williams-Sonoma.

Dividends

Williams-Sonoma pays an annual dividend of $1.56 per share and has a dividend yield of 2.9%. At Home Group does not pay a dividend. Williams-Sonoma pays out 44.2% of its earnings in the form of a dividend. At Home Group has increased its dividend for 7 consecutive years.

Summary

At Home Group beats Williams-Sonoma on 9 of the 17 factors compared between the two stocks.

About At Home Group

At Home Group, Inc. is a home decor superstore. The Company is focused on providing a range of assortment of products for any room, in any style, for any budget. As of July 30, 2016, the Company offered over 50,000 stock keeping units (SKUs) throughout its stores. As of July 30, 2016, the Company’s store base is consisted of 115 format stores across 29 states and 65 markets, averaging approximately 120,000 square feet per store.

About Williams-Sonoma

Williams-Sonoma, Inc. is a multi-channel specialty retailer of products for the home. The Company operates retail stores in the United States, Canada, Puerto Rico, Australia and the United Kingdom. It operates through two segments: e-commerce and retail. The e-commerce segment has various merchandising strategies, such as Williams-Sonoma, Pottery Barn, Pottery Barn Kids, West Elm, PBteen, Williams-Sonoma Home, Rejuvenation and Mark and Graham, which sell its products through the Company’s e-commerce Websites and direct-mail catalogs. The retail segment has various merchandising strategies, such as Williams-Sonoma, Pottery Barn, Pottery Barn Kids, West Elm and Rejuvenation, which sell its products through the Company’s retail stores. The Company franchises its brands to third parties in a number of countries in the Middle East, the Philippines and Mexico. The Company’s products are also available to customers through its catalogs and online across the world.

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