American Eagle Outfitters (NYSE:AEO) & Boot Barn (NYSE:BOOT) Financial Contrast

Boot Barn (NYSE:BOOT) and American Eagle Outfitters (NYSE:AEO) are both mid-cap retail/wholesale companies, but which is the superior investment? We will contrast the two businesses based on the strength of their institutional ownership, profitability, earnings, risk, valuation, dividends and analyst recommendations.

Risk & Volatility

Boot Barn has a beta of 1.61, indicating that its share price is 61% more volatile than the S&P 500. Comparatively, American Eagle Outfitters has a beta of 1.39, indicating that its share price is 39% more volatile than the S&P 500.

Profitability

This table compares Boot Barn and American Eagle Outfitters’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Boot Barn	10.05%	18.11%	9.94%
American Eagle Outfitters	3.90%	13.82%	5.59%

Valuation & Earnings

This table compares Boot Barn and American Eagle Outfitters”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Boot Barn	$1.91 billion	2.85	$180.94 million	$6.76	26.43
American Eagle Outfitters	$5.34 billion	0.74	$329.38 million	$1.16	20.20

American Eagle Outfitters has higher revenue and earnings than Boot Barn. American Eagle Outfitters is trading at a lower price-to-earnings ratio than Boot Barn, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Boot Barn and American Eagle Outfitters, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Boot Barn	0	4	11	0	2.73
American Eagle Outfitters	2	11	1	1	2.07

Boot Barn currently has a consensus target price of $206.08, indicating a potential upside of 15.32%. American Eagle Outfitters has a consensus target price of $22.45, indicating a potential downside of 4.15%. Given Boot Barn’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Boot Barn is more favorable than American Eagle Outfitters.

Insider and Institutional Ownership

97.3% of American Eagle Outfitters shares are held by institutional investors. 0.7% of Boot Barn shares are held by insiders. Comparatively, 8.7% of American Eagle Outfitters shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Summary

Boot Barn beats American Eagle Outfitters on 10 of the 15 factors compared between the two stocks.

About Boot Barn

Boot Barn Holdings, Inc., a lifestyle retail chain, operates specialty retail stores in the United States. The company's specialty retail stores offer western and work-related footwear, apparel, and accessories for men, women, and kids. It offers boots, shirts, jackets, hats, belts and belt buckles, handbags, western-style jewelry, rugged footwear, outerwear, overalls, denim, and flame-resistant and high-visibility clothing. The company also provides gifts and home merchandise. The company also sells its products through e-commerce websites, including bootbarn.com; sheplers.com; and countryoutfitter.com. The company was formerly known as WW Top Investment Corporation and changed its name to Boot Barn Holdings, Inc. in June 2014. Boot Barn Holdings, Inc. was founded in 1978 and is based in Irvine, California.

About American Eagle Outfitters

American Eagle Outfitters, Inc. operates as a multi-brand specialty retailer in the United States and internationally. The company provides jeans, apparel and accessories, and personal care products for women and men under the American Eagle brand; and intimates, apparel, activewear, and swim collections under the Aerie and OFFLINE by Aerie brands. It also offers menswear products under the Todd Snyder New York brand; and fashion clothing and accessories under the Unsubscribed brand. The company sells its products through own and licensed retail stores; concession-based shops-within-shops; and digital channels, such as www.ae.com, www.aerie.com, www.toddsnyder.com, and www.unsubscribed.com. American Eagle Outfitters, Inc. was founded in 1977 and is headquartered in Pittsburgh, Pennsylvania.