Critical Contrast: Tapestry (NYSE:TPR) & Sportsman’s Warehouse (NASDAQ:SPWH)

Sportsman’s Warehouse (NASDAQ:SPWH) and Tapestry (NYSE:TPR) are both retail/wholesale companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, dividends, valuation, institutional ownership, profitability and risk.

Valuation and Earnings

This table compares Sportsman’s Warehouse and Tapestry”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sportsman’s Warehouse	$1.20 billion	0.04	-$33.06 million	($0.97)	-1.43
Tapestry	$7.01 billion	4.20	$183.20 million	$2.42	60.05

Tapestry has higher revenue and earnings than Sportsman’s Warehouse. Sportsman’s Warehouse is trading at a lower price-to-earnings ratio than Tapestry, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Sportsman’s Warehouse and Tapestry’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sportsman’s Warehouse	-3.05%	-7.20%	-1.72%
Tapestry	6.95%	157.98%	19.48%

Institutional and Insider Ownership

83.0% of Sportsman’s Warehouse shares are owned by institutional investors. Comparatively, 90.8% of Tapestry shares are owned by institutional investors. 1.8% of Sportsman’s Warehouse shares are owned by company insiders. Comparatively, 1.3% of Tapestry 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.

Analyst Ratings

This is a summary of current ratings for Sportsman’s Warehouse and Tapestry, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sportsman’s Warehouse	1	1	4	0	2.50
Tapestry	0	5	13	2	2.85

Sportsman’s Warehouse currently has a consensus price target of $2.95, indicating a potential upside of 112.23%. Tapestry has a consensus price target of $147.00, indicating a potential upside of 1.15%. Given Sportsman’s Warehouse’s higher probable upside, equities research analysts plainly believe Sportsman’s Warehouse is more favorable than Tapestry.

Risk & Volatility

Sportsman’s Warehouse has a beta of 0.6, suggesting that its stock price is 40% less volatile than the S&P 500. Comparatively, Tapestry has a beta of 1.55, suggesting that its stock price is 55% more volatile than the S&P 500.

Summary

Tapestry beats Sportsman’s Warehouse on 13 of the 15 factors compared between the two stocks.

About Sportsman’s Warehouse

Sportsman’s Warehouse Holdings, Inc. engages in the retail of sporting and athletic goods. Its products include hunting and shooting, archery, fishing, camping, boating accessories, optics and electronics, knives and tools, and footwear. The company was founded in 1986 and is headquartered in West Jordan, UT.

About Tapestry

Tapestry, Inc. provides luxury accessories and branded lifestyle products in the United States, Japan, Greater China, and internationally. The company operates in three segments: Coach, Kate Spade, and Stuart Weitzman. It offers women’s handbags; and women’s accessories, such as small leather goods which includes mini and micro handbags, money pieces, wristlets, pouches, and cosmetic cases, as well as novelty accessories including address books, time management and travel accessories, sketchbooks, and portfolios; and belts, key rings, and charms. The company also provides men products, which includes bag collections, such as business cases, computer bags, messenger-style bags, backpacks, and totes; small leather goods including wallets, card cases, travel organizers, and belts; and footwear, watches, fragrances, sunglasses, novelty accessories, and ready-to-wear items. In addition, it offers other products including women’s footwear and fragrances; eyewear and sunglasses; and jewelry, such as bracelets, necklaces, rings, and earrings, watches, and other women’s seasonal lifestyle apparel collections, including outerwear, ready-to-wear and cold weather accessories, such as gloves, scarves, and hats. Further, the company provides kids items, housewares, and home accessories, such as fashion bedding and tableware, stationery, and gifts. It offers its products through e-commerce sites and concession shop-in-shops, wholesale, and third-party distributors under the Coach, Kate Spade, and Stuart Weitzman brand names. The company was formerly known as Coach, Inc. and changed its name to Tapestry, Inc. in October 2017. Tapestry, Inc. was founded in 1941 and is headquartered in New York, New York.