Reviewing MillerKnoll (NASDAQ:MLKN) and Virco Manufacturing (NASDAQ:VIRC)

MillerKnoll (NASDAQ:MLKN) and Virco Manufacturing (NASDAQ:VIRC) are both small-cap consumer discretionary companies, but which is the better stock? We will compare the two companies based on the strength of their dividends, institutional ownership, earnings, profitability, analyst recommendations, risk and valuation.

Dividends

MillerKnoll pays an annual dividend of $0.75 per share and has a dividend yield of 3.7%. Virco Manufacturing pays an annual dividend of $0.10 per share and has a dividend yield of 1.3%. MillerKnoll pays out -133.9% of its earnings in the form of a dividend. Virco Manufacturing pays out 11.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Virco Manufacturing has raised its dividend for 2 consecutive years. MillerKnoll is clearly the better dividend stock, given its higher yield and lower payout ratio.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
MillerKnoll	-1.01%	10.44%	3.40%
Virco Manufacturing	5.74%	12.04%	6.85%

Insider & Institutional Ownership

87.5% of MillerKnoll shares are held by institutional investors. Comparatively, 31.0% of Virco Manufacturing shares are held by institutional investors. 5.5% of MillerKnoll shares are held by company insiders. Comparatively, 18.1% of Virco Manufacturing shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
MillerKnoll	$3.67 billion	0.37	-$36.90 million	($0.56)	-35.79
Virco Manufacturing	$236.93 million	0.52	$21.64 million	$0.87	9.05

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

Volatility and Risk

MillerKnoll has a beta of 1.25, suggesting that its share price is 25% more volatile than the S&P 500. Comparatively, Virco Manufacturing has a beta of 0.4, suggesting that its share price is 60% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for MillerKnoll and Virco Manufacturing, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
MillerKnoll	0	3	0	0	2.00
Virco Manufacturing	0	1	1	0	2.50

Virco Manufacturing has a consensus price target of $17.00, suggesting a potential upside of 116.01%. Given Virco Manufacturing’s stronger consensus rating and higher possible upside, analysts clearly believe Virco Manufacturing is more favorable than MillerKnoll.

Summary

Virco Manufacturing beats MillerKnoll on 12 of the 17 factors compared between the two stocks.

About MillerKnoll

MillerKnoll, Inc. researches, designs, manufactures, and distributes interior furnishings worldwide. It operates through three segments: Americas Contract, International Contract & Specialty, and Global Retail. The company also provides seating products, furniture systems, other freestanding furniture elements, textiles, leather, felt, home furnishings and related services, casegoods, storage products, as well as residential, education, and healthcare furniture solutions. It offers its products under the MillerKnoll, Herman Miller, Herman Miller Circled Symbolic M, Knoll, Maharam, Geiger, Design Within Reach, DWR, HAY, NaughtOne, Nemschoff, Aeron, Mirra, Embody, Setu, Sayl, Cosm, Caper, Eames, Knoll, KnollExtra, Knoll Luxe, KnollStudio, KnollTextiles, Edelman Leather, Spinneybeck Leather, Generation by Knoll, Regeneration by Knoll, MultiGeneration by Knoll, Remix, Holly Hunt, Vladimir Kagan, Muuto, Barcelona, and Womb names. The company offers its products through independent contract furniture dealers, direct contract sales, e-commerce websites, and wholesale and retail stores. Its products are used in institutional, health/science, and residential and other environments, and industrial and educational settings, as well as transportation terminals. The company was formerly known as Herman Miller, Inc. and changed its name to MillerKnoll, Inc. in November 2021. MillerKnoll, Inc. was incorporated in 1905 and is headquartered in Zeeland, Michigan.

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.