Five Below (NASDAQ:FIVE) and Office Depot (NASDAQ:ODP) are both retail/wholesale companies, but which is the superior business? We will compare the two businesses based on the strength of their risk, valuation, profitability, analyst recommendations, earnings, institutional ownership and dividends.
Valuation and Earnings
This table compares Five Below and Office Depot's gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
|---|
| Five Below | $1.85 billion | 3.12 | $175.06 million | $2.98 | 34.73 |
| Office Depot | $10.65 billion | 0.11 | $99 million | $4.10 | 5.34 |
Five Below has higher earnings, but lower revenue than Office Depot. Office Depot is trading at a lower price-to-earnings ratio than Five Below, indicating that it is currently the more affordable of the two stocks.
Analyst Ratings
This is a summary of recent ratings and recommmendations for Five Below and Office Depot, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
|---|
| Five Below | 0 | 4 | 15 | 0 | 2.79 |
| Office Depot | 1 | 0 | 1 | 0 | 2.00 |
Five Below currently has a consensus price target of $118.5789, suggesting a potential upside of 14.57%. Office Depot has a consensus price target of $12.00, suggesting a potential downside of 45.18%. Given Five Below's stronger consensus rating and higher probable upside, research analysts clearly believe Five Below is more favorable than Office Depot.
Volatility & Risk
Five Below has a beta of 1.22, suggesting that its share price is 22% more volatile than the S&P 500. Comparatively, Office Depot has a beta of 2.31, suggesting that its share price is 131% more volatile than the S&P 500.
Institutional & Insider Ownership
92.6% of Office Depot shares are held by institutional investors. 2.4% of Five Below shares are held by company insiders. Comparatively, 1.7% of Office Depot shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.
Profitability
This table compares Five Below and Office Depot's net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
|---|
| Five Below | 5.87% | 14.23% | 5.29% |
| Office Depot | 1.28% | 11.98% | 3.58% |
Summary
Five Below beats Office Depot on 10 of the 14 factors compared between the two stocks.
