Torrid (NYSE:CURV – Get Free Report) and Stitch Fix (NASDAQ:SFIX – Get Free Report) are both small-cap retail/wholesale companies, but which is the superior stock? We will contrast the two companies based on the strength of their valuation, risk, profitability, institutional ownership, analyst recommendations, dividends and earnings.
Analyst Recommendations
This is a breakdown of recent ratings and target prices for Torrid and Stitch Fix, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Torrid | 3 | 3 | 1 | 1 | 2.00 |
| Stitch Fix | 1 | 4 | 1 | 0 | 2.00 |
Torrid currently has a consensus target price of $1.44, indicating a potential downside of 11.93%. Stitch Fix has a consensus target price of $5.00, indicating a potential upside of 46.20%. Given Stitch Fix’s higher probable upside, analysts plainly believe Stitch Fix is more favorable than Torrid.
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Torrid | $1.00 billion | 0.16 | -$7.03 million | ($0.12) | -13.63 |
| Stitch Fix | $1.27 billion | 0.37 | -$28.74 million | ($0.13) | -26.31 |
Torrid has higher earnings, but lower revenue than Stitch Fix. Stitch Fix is trading at a lower price-to-earnings ratio than Torrid, indicating that it is currently the more affordable of the two stocks.
Volatility and Risk
Torrid has a beta of 0.93, indicating that its share price is 7% less volatile than the S&P 500. Comparatively, Stitch Fix has a beta of 2.31, indicating that its share price is 131% more volatile than the S&P 500.
Profitability
This table compares Torrid and Stitch Fix’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Torrid | -1.28% | N/A | -3.09% |
| Stitch Fix | -1.89% | -12.23% | -4.99% |
Insider & Institutional Ownership
81.8% of Torrid shares are owned by institutional investors. Comparatively, 71.0% of Stitch Fix shares are owned by institutional investors. 9.8% of Torrid shares are owned by insiders. Comparatively, 16.1% of Stitch Fix shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Summary
Torrid beats Stitch Fix on 8 of the 13 factors compared between the two stocks.
About Torrid
Torrid Holdings Inc. operates in women’s plus-size apparel and intimates market in North America. The company designs, develops, and merchandises its products under the Torrid, Torrid Curve, CURV, and Lovesick brand names. It is involved in the sale of tops, bottoms, dresses, denims, activewear, intimates, sleep wear, swim wear, and outerwear products; and non-apparel products comprising accessories, footwear, and beauty products. The company sells its products directly to consumers through its e-commerce platform and its physical stores. Torrid Holdings Inc. was incorporated in 2019 and is headquartered in City Of Industry, California.
About Stitch Fix
Stitch Fix, Inc. sells a range of apparel, shoes, and accessories for men, women, and kids through its website and mobile application in the United States and the United Kingdom. It offers denim, dresses, blouses, skirts, shoes, jewelry, and handbags under the Stitch Fix brand. The company was formerly known as rack habit inc. and changed its name to Stitch Fix, Inc. in October 2011. Stitch Fix, Inc. was incorporated in 2011 and is headquartered in San Francisco, California.
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