Lulu’s Fashion Lounge (NASDAQ:LVLU – Get Free Report) and Urban Outfitters (NASDAQ:URBN – Get Free Report) are both retail/wholesale companies, but which is the better investment? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, dividends, valuation, institutional ownership and earnings.
Risk & Volatility
Lulu’s Fashion Lounge has a beta of 0.31, meaning that its share price is 69% less volatile than the S&P 500. Comparatively, Urban Outfitters has a beta of 1.44, meaning that its share price is 44% more volatile than the S&P 500.
Profitability
This table compares Lulu’s Fashion Lounge and Urban Outfitters’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Lulu’s Fashion Lounge | -19.01% | -103.82% | -22.38% |
| Urban Outfitters | 7.91% | 17.98% | 9.64% |
Valuation & Earnings
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Lulu’s Fashion Lounge | $315.89 million | 0.03 | -$55.29 million | ($20.54) | -0.18 |
| Urban Outfitters | $5.55 billion | 1.26 | $402.46 million | $4.78 | 16.28 |
Urban Outfitters has higher revenue and earnings than Lulu’s Fashion Lounge. Lulu’s Fashion Lounge is trading at a lower price-to-earnings ratio than Urban Outfitters, indicating that it is currently the more affordable of the two stocks.
Institutional & Insider Ownership
73.8% of Lulu’s Fashion Lounge shares are held by institutional investors. Comparatively, 77.6% of Urban Outfitters shares are held by institutional investors. 6.8% of Lulu’s Fashion Lounge shares are held by company insiders. Comparatively, 31.8% of Urban Outfitters shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Analyst Ratings
This is a breakdown of recent ratings and recommmendations for Lulu’s Fashion Lounge and Urban Outfitters, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Lulu’s Fashion Lounge | 0 | 1 | 0 | 0 | 2.00 |
| Urban Outfitters | 1 | 5 | 6 | 1 | 2.54 |
Lulu’s Fashion Lounge currently has a consensus price target of $15.00, suggesting a potential upside of 314.36%. Urban Outfitters has a consensus price target of $75.00, suggesting a potential downside of 3.62%. Given Lulu’s Fashion Lounge’s higher probable upside, analysts clearly believe Lulu’s Fashion Lounge is more favorable than Urban Outfitters.
Summary
Urban Outfitters beats Lulu’s Fashion Lounge on 14 of the 15 factors compared between the two stocks.
About Lulu’s Fashion Lounge
Lulu’s Fashion Lounge Holdings, Inc. engages in providing an online website for clothing. It offers retailing of women’s clothing, shoes, and accessories. The company was founded in 1996 and is headquartered in Chico, CA.
About Urban Outfitters
Urban Outfitters, Inc. engages in the retail and wholesale of general consumer products. The company operates through three segments: Retail, Wholesale, and Nuuly. It operates Urban Outfitters stores, which offer women's and men's fashion apparel, activewear, intimates, footwear, accessories, home goods, electronics, and beauty products for young adults aged 18 to 28; and Anthropologie stores that provide women's apparel, accessories, intimates, shoes, and home furnishings, as well as gifts, decorative items, and beauty and wellness products for women aged 28 to 45. The company also operates Terrain stores that provide lifestyle home products, garden and outdoor living products, antiques, live plants, flowers, wellness products, and accessories. In addition, it operates Free People retail stores, which offer casual women's apparel, intimates, activewear, shoes, accessories, home products, gifts, and beauty and wellness products for young women aged 25 to 30; and restaurants, as well as women's apparel subscription rental service under the Nuuly brand. Further, the company is involved in the wholesale of young women's contemporary casual apparel, intimates, activewear, and shoes under the Free People brand; and apparel collections under the Urban Outfitters brand. The company serves its customers directly through retail stores, websites, mobile applications, catalogs and customer contact centers, franchisee-owned stores, and department and specialty stores, as well as social media and third-party digital platforms. Urban Outfitters, Inc. was founded in 1970 and is based in Philadelphia, Pennsylvania.
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