Revolve Group (NYSE:RVLV) versus Kontoor Brands (NYSE:KTB) Financial Survey

Kontoor Brands (NYSE:KTB) and Revolve Group (NYSE:RVLV) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, earnings, profitability and dividends.

Profitability

This table compares Kontoor Brands and Revolve Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kontoor Brands	7.22%	62.02%	12.73%
Revolve Group	5.03%	12.12%	7.90%

Risk and Volatility

Kontoor Brands has a beta of 1.05, suggesting that its stock price is 5% more volatile than the S&P 500. Comparatively, Revolve Group has a beta of 1.8, suggesting that its stock price is 80% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for Kontoor Brands and Revolve Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kontoor Brands	1	3	5	1	2.60
Revolve Group	0	7	8	0	2.53

Kontoor Brands currently has a consensus target price of $91.00, suggesting a potential upside of 31.63%. Revolve Group has a consensus target price of $29.50, suggesting a potential upside of 32.55%. Given Revolve Group’s higher probable upside, analysts clearly believe Revolve Group is more favorable than Kontoor Brands.

Earnings & Valuation

This table compares Kontoor Brands and Revolve Group”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kontoor Brands	$3.15 billion	1.21	$227.45 million	$4.05	17.07
Revolve Group	$1.23 billion	1.30	$61.71 million	$0.85	26.18

Kontoor Brands has higher revenue and earnings than Revolve Group. Kontoor Brands is trading at a lower price-to-earnings ratio than Revolve Group, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

93.1% of Kontoor Brands shares are held by institutional investors. Comparatively, 67.6% of Revolve Group shares are held by institutional investors. 1.8% of Kontoor Brands shares are held by insiders. Comparatively, 43.8% of Revolve Group shares are held by 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

Kontoor Brands beats Revolve Group on 9 of the 15 factors compared between the two stocks.

About Kontoor Brands

Kontoor Brands, Inc., a lifestyle apparel company, designs, produces, procures, markets, distributes, and licenses denim, apparel, footwear, and accessories, primarily under the Wrangler and Lee brands. The company operates through two segments: Wrangler and Lee. It licenses and sells apparel under the Rock & Republic brand name. The company sells its products primarily through mass merchants, specialty stores, mid-tier and traditional department stores, company-operated stores, and online. It operates in the Americas, Europe, the Middle East, Africa, and the Asia-Pacific regions. Kontoor Brands, Inc. was incorporated in 2018 and is headquartered in Greensboro, North Carolina.

About Revolve Group

Revolve Group, Inc. operates as an online fashion retailer for millennial and generation z consumers in the United States and internationally. The company operates in two segments, REVOLVE and FWRD. It operates a platform that connects consumers and global fashion influencers, as well as emerging, established, and owned brands. The company offers apparel, footwear, accessories, beauty, and home products from emerging, established, and owned brands, as well as luxury brands through its websites and mobile apps. The company was formerly known as Advance Holdings, LLC and changed its name to Revolve Group, Inc. in October 2018. Revolve Group, Inc. was founded in 2003 and is headquartered in Cerritos, California.