Contrasting NIKE (NYSE:NKE) & Xtep International (OTCMKTS:XTEPY)

NIKE (NYSE:NKE) and Xtep International (OTCMKTS:XTEPY) are both consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their profitability, institutional ownership, risk, valuation, analyst recommendations, dividends and earnings.

Institutional & Insider Ownership

64.3% of NIKE shares are owned by institutional investors. 0.8% of NIKE shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Risk and Volatility

NIKE has a beta of 1.31, meaning that its stock price is 31% more volatile than the S&P 500. Comparatively, Xtep International has a beta of 0.65, meaning that its stock price is 35% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for NIKE and Xtep International, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
NIKE	2	16	18	0	2.44
Xtep International	0	1	0	0	2.00

NIKE currently has a consensus price target of $63.31, suggesting a potential upside of 48.64%. Given NIKE’s stronger consensus rating and higher probable upside, analysts clearly believe NIKE is more favorable than Xtep International.

Profitability

This table compares NIKE and Xtep International’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
NIKE	4.84%	16.41%	6.05%
Xtep International	N/A	N/A	N/A

Earnings and Valuation

This table compares NIKE and Xtep International”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
NIKE	$46.31 billion	1.36	$3.22 billion	$1.51	28.21
Xtep International	$1.97 billion	0.83	$190.81 million	N/A	N/A

NIKE has higher revenue and earnings than Xtep International.

Dividends

NIKE pays an annual dividend of $1.64 per share and has a dividend yield of 3.9%. Xtep International pays an annual dividend of $4.48 per share and has a dividend yield of 7.7%. NIKE pays out 108.6% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. NIKE has raised its dividend for 22 consecutive years.

Summary

NIKE beats Xtep International on 13 of the 15 factors compared between the two stocks.

About NIKE

NIKE, Inc., together with its subsidiaries, designs, develops, markets, and sells athletic footwear, apparel, equipment, accessories, and services worldwide. The company provides athletic and casual footwear, apparel, and accessories under the Jumpman trademark; and casual sneakers, apparel, and accessories under the Converse, Chuck Taylor, All Star, One Star, Star Chevron, and Jack Purcell trademarks. It also sells a line of performance equipment and accessories comprising bags, sport balls, socks, eyewear, timepieces, digital devices, bats, gloves, protective equipment, and other equipment for sports activities under the NIKE brand; and various plastic products to other manufacturers. In addition, the company markets apparel with licensed college and professional team, and league logos, as well as sells sports apparel; and licenses unaffiliated parties to manufacture and sell apparel, digital devices, and applications and other equipment for sports activities under NIKE-owned trademarks. It sells its products to footwear stores; sporting goods stores; athletic specialty stores; department stores; skate, tennis, and golf shops; and other retail accounts through NIKE-owned retail stores, digital platforms, independent distributors, licensees, and sales representatives. NIKE, Inc. was founded in 1964 and is headquartered in Beaverton, Oregon.

About Xtep International

Xtep International Holdings Limited engages in the design, development, manufacture, sale, and marketing and brand management of sports footwear, apparel, and accessories. The company sells its products primarily under the XTEP brand, as well as Palladium, K-Swiss, Saucony, and Merrell brand names. It is also involved in the trading of sportswear products. As of March 18, 2021, the company managed an extensive distribution network with exclusive distributors that operated approximately 6,000 stores covering 31 provinces, autonomous regions, and municipalities in the People's Republic of China and internationally. It also offers its products online. The company was founded in 1999 and is headquartered in Xiamen, the People's Republic of China. Xtep International Holdings Limited is a subsidiary of Group Success Investments Limited.