Ascena Retail Group (NASDAQ: ASNA) and Stein Mart (NASDAQ:SMRT) are both small-cap retail/wholesale companies, but which is the better stock? We will compare the two companies based on the strength of their risk, analyst recommendations, institutional ownership, valuation, dividends, earnings and profitability.
Valuation and Earnings
This table compares Ascena Retail Group and Stein Mart’s top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Ascena Retail Group||$6.80 billion||0.06||$581.10 million||($5.33)||-0.41|
|Stein Mart||$1.34 billion||0.04||$27.67 million||($0.21)||-5.90|
Ascena Retail Group has higher revenue and earnings than Stein Mart. Stein Mart is trading at a lower price-to-earnings ratio than Ascena Retail Group, indicating that it is currently the more affordable of the two stocks.
Risk and Volatility
Ascena Retail Group has a beta of 1.91, meaning that its stock price is 91% more volatile than the S&P 500. Comparatively, Stein Mart has a beta of 0.81, meaning that its stock price is 19% less volatile than the S&P 500.
This table compares Ascena Retail Group and Stein Mart’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Ascena Retail Group||-15.25%||2.96%||0.94%|
This is a breakdown of recent ratings for Ascena Retail Group and Stein Mart, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Ascena Retail Group||1||7||0||0||1.88|
Ascena Retail Group presently has a consensus target price of $4.50, indicating a potential upside of 105.48%. Stein Mart has a consensus target price of $7.50, indicating a potential upside of 504.84%. Given Stein Mart’s stronger consensus rating and higher probable upside, analysts clearly believe Stein Mart is more favorable than Ascena Retail Group.
Stein Mart pays an annual dividend of $0.30 per share and has a dividend yield of 24.2%. Ascena Retail Group does not pay a dividend. Stein Mart pays out -142.9% of its earnings in the form of a dividend.
Insider and Institutional Ownership
96.2% of Ascena Retail Group shares are owned by institutional investors. Comparatively, 43.7% of Stein Mart shares are owned by institutional investors. 8.6% of Ascena Retail Group shares are owned by company insiders. Comparatively, 34.7% of Stein Mart shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Ascena Retail Group Company Profile
Ascena Retail Group, Inc. is a specialty retailer of apparel for women and tween girls. The Company operates through six segments: ANN, Justice, Lane Bryant, maurices, dressbarn and Catherines. The ANN segment offers feminine classics and fashion choices, sold primarily under the Ann Taylor and LOFT brands. The Justice segment offers apparel to girls who are aged 6 to 12. The Lane Bryant segment offers apparel to female customers in plus-sizes 14-28. The maurices segment offers women’s casual clothing, career wear, dressy apparel, active wear and accessories. The dressbarn segment consists of the specialty retail, outlet and e-commerce operations of the dressbarn brand. The Catherines segment offers classic apparel and accessories to female customers for wear-to-work and casual lifestyles. As of July 30, 2016, the Company operated approximately 4,900 stores in 49 United States’ states, the District of Columbia, Canada and Puerto Rico.
Stein Mart Company Profile
Stein Mart, Inc. is a national retailer offering the fashion merchandise, service and presentation of a department or specialty store. The Company offers apparel for women and men, as well as accessories, shoes and home fashions. The Company’s target customers are women over 45 years old. The Company operates approximately 280 stores in over 30 states and an Internet store. Its stores are located in the Northeast, Midwest, Southeast, Texas and the Southwest. It is concentrated in the Southeast and Texas where over 180 of its stores are located. The Company’s stores offer a range of services, such as merchandise locator service, a Preferred Customer program, co-branded and private label credit card programs, and electronic gift cards. The Company’s merchants purchase products from approximately 1,200 vendors. It leases all of its store locations, generally for approximately 10 years with options to extend the lease term for over two or five year periods.
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