Contrasting Tapestry (NYSE:TPR) & Shoe Carnival (NASDAQ:SCVL)

Tapestry (NYSE:TPR) and Shoe Carnival (NASDAQ:SCVL) are both retail/wholesale companies, but which is the superior stock? We will contrast the two businesses based on the strength of their analyst recommendations, institutional ownership, earnings, valuation, profitability, risk and dividends.

Risk and Volatility

Tapestry has a beta of 1.46, meaning that its share price is 46% more volatile than the S&P 500. Comparatively, Shoe Carnival has a beta of 1.41, meaning that its share price is 41% more volatile than the S&P 500.

Profitability

This table compares Tapestry and Shoe Carnival’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tapestry	12.50%	51.84%	10.83%
Shoe Carnival	5.58%	10.43%	5.92%

Insider and Institutional Ownership

90.8% of Tapestry shares are owned by institutional investors. Comparatively, 66.1% of Shoe Carnival shares are owned by institutional investors. 1.2% of Tapestry shares are owned by insiders. Comparatively, 35.5% of Shoe Carnival shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Tapestry and Shoe Carnival”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tapestry	$6.67 billion	2.71	$816.00 million	$3.80	22.94
Shoe Carnival	$1.20 billion	0.44	$73.77 million	$2.39	8.05

Tapestry has higher revenue and earnings than Shoe Carnival. Shoe Carnival is trading at a lower price-to-earnings ratio than Tapestry, indicating that it is currently the more affordable of the two stocks.

Dividends

Tapestry pays an annual dividend of $1.40 per share and has a dividend yield of 1.6%. Shoe Carnival pays an annual dividend of $0.60 per share and has a dividend yield of 3.1%. Tapestry pays out 36.8% of its earnings in the form of a dividend. Shoe Carnival pays out 25.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Tapestry has increased its dividend for 3 consecutive years and Shoe Carnival has increased its dividend for 14 consecutive years. Shoe Carnival is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of current ratings and price targets for Tapestry and Shoe Carnival, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tapestry	0	3	17	0	2.85
Shoe Carnival	0	0	1	0	3.00

Tapestry currently has a consensus target price of $88.78, indicating a potential upside of 1.86%. Shoe Carnival has a consensus target price of $51.00, indicating a potential upside of 164.94%. Given Shoe Carnival’s stronger consensus rating and higher probable upside, analysts plainly believe Shoe Carnival is more favorable than Tapestry.

Summary

Tapestry beats Shoe Carnival on 11 of the 17 factors compared between the two stocks.

About Tapestry

Tapestry, Inc. provides luxury accessories and branded lifestyle products in the United States, Japan, Greater China, and internationally. The company operates in three segments: Coach, Kate Spade, and Stuart Weitzman. It offers women’s handbags; and women’s accessories, such as small leather goods which includes mini and micro handbags, money pieces, wristlets, pouches, and cosmetic cases, as well as novelty accessories including address books, time management and travel accessories, sketchbooks, and portfolios; and belts, key rings, and charms. The company also provides men products, which includes bag collections, such as business cases, computer bags, messenger-style bags, backpacks, and totes; small leather goods including wallets, card cases, travel organizers, and belts; and footwear, watches, fragrances, sunglasses, novelty accessories, and ready-to-wear items. In addition, it offers other products including women’s footwear and fragrances; eyewear and sunglasses; and jewelry, such as bracelets, necklaces, rings, and earrings, watches, and other women’s seasonal lifestyle apparel collections, including outerwear, ready-to-wear and cold weather accessories, such as gloves, scarves, and hats. Further, the company provides kids items, housewares, and home accessories, such as fashion bedding and tableware, stationery, and gifts. It offers its products through e-commerce sites and concession shop-in-shops, wholesale, and third-party distributors under the Coach, Kate Spade, and Stuart Weitzman brand names. The company was formerly known as Coach, Inc. and changed its name to Tapestry, Inc. in October 2017. Tapestry, Inc. was founded in 1941 and is headquartered in New York, New York.

About Shoe Carnival

Shoe Carnival, Inc., together with its subsidiaries, operates as a family footwear retailer in the United States. The company offers range of dress, casual, work, and athletic shoes, as well as sandals and boots for men, women, and children; and various accessories. The company also operates stores, and sells its products through online shopping at shoecarnival.com, as well as through mobile app. Shoe Carnival, Inc. was founded in 1978 and is headquartered in Evansville, Indiana.