Head to Head Comparison: Sally Beauty (NYSE:SBH) versus DICK’S Sporting Goods (NYSE:DKS)

DICK’S Sporting Goods (NYSE:DKS) and Sally Beauty (NYSE:SBH) are both retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, profitability, risk, valuation, institutional ownership, analyst recommendations and earnings.

Valuation & Earnings

This table compares DICK’S Sporting Goods and Sally Beauty”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DICK’S Sporting Goods	$13.44 billion	1.42	$1.17 billion	$12.43	17.07
Sally Beauty	$3.70 billion	0.40	$195.88 million	$1.89	8.07

DICK’S Sporting Goods has higher revenue and earnings than Sally Beauty. Sally Beauty is trading at a lower price-to-earnings ratio than DICK’S Sporting Goods, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current recommendations and price targets for DICK’S Sporting Goods and Sally Beauty, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DICK’S Sporting Goods	2	11	11	0	2.38
Sally Beauty	1	4	3	0	2.25

DICK’S Sporting Goods currently has a consensus target price of $235.10, indicating a potential upside of 10.79%. Sally Beauty has a consensus target price of $14.60, indicating a potential downside of 4.23%. Given DICK’S Sporting Goods’ stronger consensus rating and higher possible upside, analysts plainly believe DICK’S Sporting Goods is more favorable than Sally Beauty.

Profitability

This table compares DICK’S Sporting Goods and Sally Beauty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DICK’S Sporting Goods	6.86%	30.55%	9.43%
Sally Beauty	5.29%	27.07%	7.15%

Risk and Volatility

DICK’S Sporting Goods has a beta of 1.17, meaning that its stock price is 17% more volatile than the S&P 500. Comparatively, Sally Beauty has a beta of 1.13, meaning that its stock price is 13% more volatile than the S&P 500.

Institutional & Insider Ownership

89.8% of DICK’S Sporting Goods shares are held by institutional investors. 32.6% of DICK’S Sporting Goods shares are held by company insiders. Comparatively, 2.0% of Sally Beauty shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Summary

DICK’S Sporting Goods beats Sally Beauty on 14 of the 14 factors compared between the two stocks.

About DICK’S Sporting Goods

DICK’s Sporting Goods, Inc. engages in the retailing of an extensive assortment of authentic sports equipment, apparel, footwear, and accessories. It also offers its products both online and through mobile applications. The company was founded by Richard T. Stack in 1948 and is headquartered in Coraopolis, PA.

About Sally Beauty

Sally Beauty Holdings, Inc. operates as a specialty retailer and distributor of professional beauty supplies. The company operates through two segments, Sally Beauty Supply and Beauty Systems Group. The Sally Beauty Supply segment offers beauty products, including hair color and care products, skin and nail care products, styling tools, and other beauty products for retail customers, salons, and salon professionals. This segment also provides products under Wella and L'Oreal brands. The Beauty Systems Group segment offers professional beauty products, such as hair color and care products, skin and nail care products, styling tools, and other beauty items directly to salons and salon professionals through its professional-only stores, e-commerce platforms, and sales force, as well as through franchised stores under the Armstrong McCall store name. This segment also sells products under Paul Mitchell and Wella brands. It operates stores and franchised units in the United States, Puerto Rico, Canada, Mexico, Chile, Peru, the United Kingdom, Ireland, Belgium, France, the Netherlands, Spain, and Germany. The company distributes its products through full-service/exclusive distributors and open-line distributors. Sally Beauty Holdings, Inc. was founded in 1964 and is headquartered in Denton, Texas.