Analyzing FIGS (NYSE:FIGS) and Lulu’s Fashion Lounge (NASDAQ:LVLU)

FIGS (NYSE:FIGS) and Lulu’s Fashion Lounge (NASDAQ:LVLU) are both retail/wholesale companies, but which is the better stock? We will contrast the two companies based on the strength of their institutional ownership, analyst recommendations, risk, earnings, dividends, valuation and profitability.

Institutional and Insider Ownership

92.2% of FIGS shares are owned by institutional investors. Comparatively, 73.8% of Lulu’s Fashion Lounge shares are owned by institutional investors. 29.4% of FIGS shares are owned by insiders. Comparatively, 6.8% of Lulu’s Fashion Lounge shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Risk and Volatility

FIGS has a beta of 1.2, meaning that its share price is 20% more volatile than the S&P 500. Comparatively, Lulu’s Fashion Lounge has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings for FIGS and Lulu’s Fashion Lounge, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
FIGS	0	5	4	2	2.73
Lulu’s Fashion Lounge	1	0	0	0	1.00

FIGS presently has a consensus target price of $15.64, suggesting a potential downside of 5.25%. Given FIGS’s stronger consensus rating and higher probable upside, analysts clearly believe FIGS is more favorable than Lulu’s Fashion Lounge.

Valuation & Earnings

This table compares FIGS and Lulu’s Fashion Lounge”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
FIGS	$631.10 million	4.35	$34.25 million	$0.19	86.89
Lulu’s Fashion Lounge	$282.28 million	0.10	-$13.71 million	($4.91)	-1.95

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

Profitability

This table compares FIGS and Lulu’s Fashion Lounge’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
FIGS	5.43%	8.41%	6.33%
Lulu’s Fashion Lounge	-4.86%	-335.73%	-13.44%

Summary

FIGS beats Lulu’s Fashion Lounge on 15 of the 15 factors compared between the two stocks.

About FIGS

FIGS, Inc. operates as a direct-to-consumer healthcare apparel and lifestyle company in the United States and internationally. It designs and sells healthcare apparel and scrubwear and non-scrubwear offerings, such as outerwear, underscrubs, footwear, compression socks, lab coats, loungewear, and other apparel. It also offers sports bras, performance leggings, tops, super-soft pima cotton tops, vests, fleeces, and jackets; necessities, scrub caps, lanyards, badge reels, tote bags, baseball caps, and beanies. The company markets and sells its products to healthcare professionals through its direct-to-consumer digital platform comprising website, mobile app, and B2B business, as well as retail store. FIGS, Inc. was founded in 2013 and is headquartered in Santa Monica, California. FIGS, Inc.

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.