Five Below (NASDAQ:FIVE) and DICK'S Sporting Goods (NYSE:DKS) are both retail/wholesale companies, but which is the better investment? We will compare the two companies based on the strength of their earnings, valuation, dividends, risk, profitability, analyst recommendations and institutional ownership.
Analyst Ratings
This is a summary of recent recommendations and price targets for Five Below and DICK'S Sporting Goods, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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Five Below | 0 | 4 | 17 | 0 | 2.81 |
DICK'S Sporting Goods | 2 | 12 | 10 | 0 | 2.33 |
Five Below currently has a consensus price target of $174.1364, indicating a potential downside of 7.25%. DICK'S Sporting Goods has a consensus price target of $56.00, indicating a potential downside of 17.31%. Given Five Below's stronger consensus rating and higher possible upside, equities analysts clearly believe Five Below is more favorable than DICK'S Sporting Goods.
Valuation and Earnings
This table compares Five Below and DICK'S Sporting Goods' revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio |
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Five Below | $1.85 billion | 5.71 | $175.06 million | $2.98 | 63.37 |
DICK'S Sporting Goods | $8.75 billion | 0.70 | $297.46 million | $3.69 | 18.42 |
DICK'S Sporting Goods has higher revenue and earnings than Five Below. DICK'S Sporting Goods is trading at a lower price-to-earnings ratio than Five Below, indicating that it is currently the more affordable of the two stocks.
Risk & Volatility
Five Below has a beta of 1.19, meaning that its share price is 19% more volatile than the S&P 500. Comparatively, DICK'S Sporting Goods has a beta of 1.62, meaning that its share price is 62% more volatile than the S&P 500.
Insider and Institutional Ownership
76.5% of DICK'S Sporting Goods shares are held by institutional investors. 2.4% of Five Below shares are held by company insiders. Comparatively, 30.6% of DICK'S Sporting Goods shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.
Profitability
This table compares Five Below and DICK'S Sporting Goods' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
---|
Five Below | 6.13% | 14.72% | 5.33% |
DICK'S Sporting Goods | 4.20% | 25.52% | 6.49% |
Summary
DICK'S Sporting Goods beats Five Below on 8 of the 14 factors compared between the two stocks.