Head-To-Head Review: Capri (NYSE:CPRI) & Children’s Place (NASDAQ:PLCE)

Children’s Place (NASDAQ:PLCE) and Capri (NYSE:CPRI) are both retail/wholesale companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, valuation, institutional ownership, earnings, dividends, analyst recommendations and profitability.

Risk and Volatility

Children’s Place has a beta of 1.97, indicating that its stock price is 97% more volatile than the S&P 500. Comparatively, Capri has a beta of 1.45, indicating that its stock price is 45% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Children’s Place and Capri, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Children’s Place	1	1	0	0	1.50
Capri	1	7	6	1	2.47

Children’s Place currently has a consensus price target of $4.50, indicating a potential upside of 12.22%. Capri has a consensus price target of $26.46, indicating a potential upside of 29.64%. Given Capri’s stronger consensus rating and higher probable upside, analysts clearly believe Capri is more favorable than Children’s Place.

Insider & Institutional Ownership

84.3% of Capri shares are held by institutional investors. 0.6% of Children’s Place shares are held by insiders. Comparatively, 2.3% of Capri shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Children’s Place and Capri’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Children’s Place	-4.01%	N/A	-6.44%
Capri	-13.57%	-430.23%	-8.70%

Earnings & Valuation

This table compares Children’s Place and Capri”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Children’s Place	$1.39 billion	0.06	-$57.82 million	($2.62)	-1.53
Capri	$4.44 billion	0.55	-$1.18 billion	($4.26)	-4.79

Children’s Place has higher earnings, but lower revenue than Capri. Capri is trading at a lower price-to-earnings ratio than Children’s Place, indicating that it is currently the more affordable of the two stocks.

Summary

Capri beats Children’s Place on 8 of the 15 factors compared between the two stocks.

About Children’s Place

The Children’s Place, Inc. engages in the provision of apparel, footwear, accessories, and other items for children. The firm also designs contracts to manufacture and sell fashionable and value-priced merchandise under the brand names of The Children’s Place, Baby Place, and Gymboree. It operates through The Children’s Place U.S. and The Children’s Place International segments. The Children’s Place U.S. segment refers to the company’s U.S. and Puerto Rico-based stores and revenue from its U.S. based wholesale business. The Children’s Place International segment is involved in the Canadian-based stores, revenue from the company’s Canadian-based wholesale business, as well as revenue from international franchisees. The company was founded by David Pulver and Clinton A. Clark in 1969 and is headquartered in Secaucus, NJ.

About Capri

Capri Holdings Limited designs, markets, distributes, and retails branded women's and men's apparel, footwear, and accessories in the United States, Canada, Latin America, Europe, the Middle East, Africa, and Asia. It operates through three segments: Versace, Jimmy Choo, and Michael Kors. The company offers ready-to-wear, accessories, footwear, handbags, scarves and belts, small leather goods, eyewear, watches, jewelry, fragrances, and home furnishings through a distribution network, including boutiques, department, and specialty stores, as well as through e-commerce sites. It also engages in licensing agreements to the manufacture and sale of watches, jewelry, eyewear, and fragrances. The company was formerly known as Michael Kors Holdings Limited and changed its name to Capri Holdings Limited in December 2018. Capri Holdings Limited was founded in 1981 and is headquartered in London, the United Kingdom.