Critical Contrast: Xtep International (OTCMKTS:XTEPY) vs. Wolverine World Wide (NYSE:WWW)

Wolverine World Wide (NYSE:WWW) and Xtep International (OTCMKTS:XTEPY) are both small-cap consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, valuation, institutional ownership, profitability, earnings and dividends.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Wolverine World Wide and Xtep International, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Wolverine World Wide	0	6	5	0	2.45
Xtep International	0	1	0	0	2.00

Wolverine World Wide currently has a consensus target price of $22.33, indicating a potential upside of 27.70%. Given Wolverine World Wide’s stronger consensus rating and higher probable upside, equities research analysts plainly believe Wolverine World Wide is more favorable than Xtep International.

Dividends

Wolverine World Wide pays an annual dividend of $0.40 per share and has a dividend yield of 2.3%. Xtep International pays an annual dividend of $4.48 per share and has a dividend yield of 7.6%. Wolverine World Wide pays out 35.4% of its earnings in the form of a dividend.

Risk & Volatility

Wolverine World Wide has a beta of 1.85, indicating that its stock price is 85% more volatile than the S&P 500. Comparatively, Xtep International has a beta of 0.65, indicating that its stock price is 35% less volatile than the S&P 500.

Earnings and Valuation

This table compares Wolverine World Wide and Xtep International”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Wolverine World Wide	$1.87 billion	0.76	$95.80 million	$1.13	15.48
Xtep International	$1.97 billion	0.84	$190.79 million	N/A	N/A

Xtep International has higher revenue and earnings than Wolverine World Wide.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Wolverine World Wide	5.06%	29.84%	6.44%
Xtep International	N/A	N/A	N/A

Institutional & Insider Ownership

90.3% of Wolverine World Wide shares are held by institutional investors. 1.5% of Wolverine World Wide shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Summary

Wolverine World Wide beats Xtep International on 9 of the 14 factors compared between the two stocks.

About Wolverine World Wide

Wolverine World Wide, Inc. designs, manufactures, sources, markets, licenses, and distributes footwear, apparel, and accessories in the United States, Europe, the Middle East, Africa, the Asia Pacific, Canada and Latin America. It operates through Active Group and Work Group segments. The company offers casual footwear and apparel; performance outdoor and athletic footwear and apparel; kids' footwear; industrial work boots and apparel; and uniform shoes and boots. The company sources and markets a range of footwear and apparel styles, including shoes, boots and sandals under the Bates, Cat, Chaco, Harley-Davidson, Hush Puppies, Hytest, Merrell, Saucony, Sperry, Keds, Sweaty Betty, and Wolverine brands; and licenses under the Stride Rite brand. It also markets Merrell and Wolverine branded apparel and accessories, as well as licenses its brands for use on non-footwear products, including the Hush Puppies apparel, eyewear, watches, socks, handbags, and plush toys; and Wolverine branded eyewear and gloves. In addition, the company markets pigskin leather under the Wolverine Leather division; sourcing division provides consulting services related to product development, production control, quality assurance, materials procurement, compliance, and other service; and multi-brand direct-to-consumer division includes retail stores that sell footwear and apparel of its brand portfolio. Further, it sells its products to department stores, national chains, catalog and specialty retailers, independent retailers, uniform outlets, and mass merchant and government customers through retail stores, third-party licensees and distributors, and joint ventures; and operates brick and mortar retails stores, and e-commerce sites. Additionally, the company operates through a network of retail stores and e-commerce sites. Wolverine World Wide, Inc. was founded in 1883 and is headquartered in Rockford, Michigan.

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.