Head-To-Head Comparison: Bassett Furniture Industries (NASDAQ:BSET) vs. Virco Manufacturing (NASDAQ:VIRC)

Bassett Furniture Industries (NASDAQ:BSET) and Virco Manufacturing (NASDAQ:VIRC) are both small-cap consumer discretionary companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, risk, profitability, analyst recommendations and dividends.

Volatility & Risk

Bassett Furniture Industries has a beta of 1.15, indicating that its share price is 15% more volatile than the S&P 500. Comparatively, Virco Manufacturing has a beta of 0.37, indicating that its share price is 63% less volatile than the S&P 500.

Institutional & Insider Ownership

54.4% of Bassett Furniture Industries shares are held by institutional investors. Comparatively, 31.0% of Virco Manufacturing shares are held by institutional investors. 7.3% of Bassett Furniture Industries shares are held by insiders. Comparatively, 18.1% of Virco Manufacturing shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Bassett Furniture Industries and Virco Manufacturing’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Bassett Furniture Industries	0.76%	1.48%	0.74%
Virco Manufacturing	7.99%	17.61%	9.63%

Valuation and Earnings

This table compares Bassett Furniture Industries and Virco Manufacturing”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Bassett Furniture Industries	$329.92 million	0.41	-$9.69 million	$0.29	53.83
Virco Manufacturing	$266.24 million	0.48	$21.64 million	$1.26	6.41

Virco Manufacturing has lower revenue, but higher earnings than Bassett Furniture Industries. Virco Manufacturing is trading at a lower price-to-earnings ratio than Bassett Furniture Industries, indicating that it is currently the more affordable of the two stocks.

Dividends

Bassett Furniture Industries pays an annual dividend of $0.80 per share and has a dividend yield of 5.1%. Virco Manufacturing pays an annual dividend of $0.10 per share and has a dividend yield of 1.2%. Bassett Furniture Industries pays out 275.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Virco Manufacturing pays out 7.9% of its earnings in the form of a dividend. Bassett Furniture Industries has raised its dividend for 4 consecutive years and Virco Manufacturing has raised its dividend for 2 consecutive years. Bassett Furniture Industries is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of current recommendations and price targets for Bassett Furniture Industries and Virco Manufacturing, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Bassett Furniture Industries	0	0	0	0	0.00
Virco Manufacturing	0	1	1	0	2.50

Virco Manufacturing has a consensus target price of $17.00, suggesting a potential upside of 110.40%. Given Virco Manufacturing’s stronger consensus rating and higher probable upside, analysts clearly believe Virco Manufacturing is more favorable than Bassett Furniture Industries.

Summary

Virco Manufacturing beats Bassett Furniture Industries on 11 of the 17 factors compared between the two stocks.

About Bassett Furniture Industries

Bassett Furniture Industries, Incorporated, together with its subsidiaries, manufactures, markets, and retails home furnishings in the United States and internationally. It operates in three segments: Wholesale, Retail Company-Owned Stores, and Corporate and Other. The company engages in the design, manufacture, sourcing, sale, and distribution of furniture products, including dining, bedroom and bedding, home decorations, rugs, and outdoor furniture to a network of company-owned retail stores, licensee-owned stores, and independent retailers. The company also distributes its products through multi-line furniture stores, including Bassett galleries or design centers, as well as sells online; and engages in wood and upholstery operations. In addition, it owns and leases land, retail store properties, warehouses, and distribution centers. Bassett Furniture Industries, Incorporated was founded in 1902 and is based in Bassett, Virginia.

About Virco Manufacturing

Virco Mfg. Corporation engages in the design, production, and distribution of furniture in the United States and Canada. The company offers seating products, including 4-leg chairs, cantilever chairs, mobile task chairs and lab stools, tablet armchairs, steel-frame and floor rockers, series stools, hard plastic seating, folding and upholstered stack chairs, and plastic stack and upholstered ergonomic chairs. It also provides activity, butcher block, folding, office, technology, and mobile tables; desks and workstations, and instructor media stations and towers; chair desks and combo units, tablet arm and caster units, mobile workstations, student desks, and returns and credenzas; and computer furniture solutions. In addition, the company provides administrative office furniture, including desks, returns, bookcases, and other items, as well as steel storage cabinets, wardrobe tower cabinets, file credenzas, and mobile pedestals; laboratory furniture comprising steel-based science tables, table bases, lab stools, and wood-frame science tables; mobile furniture, such as mobile tables, mobile cabinets, and mobile chairs for school settings and offices; and handling and storage equipment, and stackable storage trucks. It serves public and private educational institutions, charter schools, convention centers and arenas, hospitality providers, government facilities, and places of worship through its sales and support teams, and dealers' network. Virco Mfg. Corporation was incorporated in 1950 and is headquartered in Torrance, California.