Financial Contrast: lululemon athletica (NASDAQ:LULU) and Wacoal (OTCMKTS:WACLY)

lululemon athletica (NASDAQ:LULU) and Wacoal (OTCMKTS:WACLY) are both consumer discretionary companies, but which is the better investment? We will compare the two companies based on the strength of their profitability, institutional ownership, analyst recommendations, dividends, risk, earnings and valuation.

Profitability

This table compares lululemon athletica and Wacoal’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
lululemon athletica	16.82%	43.48%	25.05%
Wacoal	4.06%	3.39%	2.48%

Analyst Ratings

This is a summary of recent recommendations and price targets for lululemon athletica and Wacoal, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
lululemon athletica	1	13	16	1	2.55
Wacoal	0	0	0	0	0.00

lululemon athletica presently has a consensus price target of $331.80, suggesting a potential upside of 65.46%. Given lululemon athletica’s stronger consensus rating and higher possible upside, research analysts plainly believe lululemon athletica is more favorable than Wacoal.

Volatility & Risk

lululemon athletica has a beta of 1.17, indicating that its share price is 17% more volatile than the S&P 500. Comparatively, Wacoal has a beta of -0.08, indicating that its share price is 108% less volatile than the S&P 500.

Valuation & Earnings

This table compares lululemon athletica and Wacoal”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
lululemon athletica	$10.59 billion	2.27	$1.81 billion	$14.76	13.59
Wacoal	$1.14 billion	1.51	$46.13 million	$4.29	38.81

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

Insider & Institutional Ownership

85.2% of lululemon athletica shares are held by institutional investors. 0.5% of lululemon athletica shares are held by insiders. Comparatively, 0.8% of Wacoal shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

lululemon athletica beats Wacoal on 13 of the 15 factors compared between the two stocks.

About lululemon athletica

Lululemon Athletica Inc., together with its subsidiaries, designs, distributes, and retails athletic apparel, footwear, and accessories under the lululemon brand for women and men. It offers pants, shorts, tops, and jackets for healthy lifestyle, such as yoga, running, training, and other activities. It also provides fitness-inspired accessories. The company sells its products through a chain of company-operated stores; outlets; interactive workout platform; yoga and fitness studios, university campus retailers, and other partners; license and supply arrangements; and temporary locations, as well as through mobile apps and lululemon.com e-commerce website. It has operations in the United States, Canada, Mainland China, Australia, South Korea, Hong Kong, Japan, New Zealand, Taiwan, Singapore, Malaysia, Macau, Thailand, the Asia Pacific, the United Kingdom, Germany, France, Ireland, Spain, the Netherlands, Sweden, Norway, Switzerland, Europe, the Middle East, and Africa. Lululemon Athletica Inc. was founded in 1998 and is based in Vancouver, Canada.

About Wacoal

Wacoal Holdings Corp. engages in the manufacturing, wholesale, and retail sale of intimate apparel, outerwear, sportswear, and other textile products and accessories in Japan, Asia, Oceania, the United States, and Europe. The company operates through Wacoal Business (Domestic), Wacoal Business (Overseas), Peach John Business, and Other Businesses segments. It offers intimate apparel mainly women’s foundation wear, lingerie, nightwear and children’s underwear; and outerwear, sportswear, and other textile products and accessories. The company also engages in the restaurant, cultural and service-related businesses; and manufacture and sale of mannequins and fixtures, interior design work, and other textile-related businesses. It offers products through department stores, general merchandisers, and other general retailers in Japan, as well as directly managed retail stores, E-commerce websites, and distributors in Japan and internationally. Wacoal Holdings Corp. was founded in 1946 and is headquartered in Kyoto, Japan.