Sally Beauty (NYSE:SBH) and DICK'S Sporting Goods (NYSE:DKS) are both retail/wholesale companies, but which is the better business? We will compare the two companies based on the strength of their institutional ownership, profitability, risk, earnings, analyst recommendations, dividends and valuation.
Insider and Institutional Ownership
76.5% of DICK'S Sporting Goods shares are held by institutional investors. 3.1% of Sally Beauty 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 endowments, hedge funds and large money managers believe a company will outperform the market over the long term.
Valuation and Earnings
This table compares Sally Beauty 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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Sally Beauty | $3.51 billion | 0.57 | $113.25 million | $1.22 | 14.51 |
DICK'S Sporting Goods | $8.75 billion | 0.76 | $297.46 million | $3.69 | 20.05 |
DICK'S Sporting Goods has higher revenue and earnings than Sally Beauty. Sally Beauty is trading at a lower price-to-earnings ratio than DICK'S Sporting Goods, indicating that it is currently the more affordable of the two stocks.
Analyst Recommendations
This is a summary of current ratings and recommmendations for Sally Beauty and DICK'S Sporting Goods, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score |
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Sally Beauty | 1 | 4 | 1 | 0 | 2.00 |
DICK'S Sporting Goods | 2 | 11 | 12 | 0 | 2.40 |
Sally Beauty currently has a consensus target price of $12.50, suggesting a potential downside of 29.42%. DICK'S Sporting Goods has a consensus target price of $60.6667, suggesting a potential downside of 18.02%. Given DICK'S Sporting Goods' stronger consensus rating and higher possible upside, analysts plainly believe DICK'S Sporting Goods is more favorable than Sally Beauty.
Risk & Volatility
Sally Beauty has a beta of 1.54, suggesting that its stock price is 54% more volatile than the S&P 500. Comparatively, DICK'S Sporting Goods has a beta of 1.62, suggesting that its stock price is 62% more volatile than the S&P 500.
Profitability
This table compares Sally Beauty and DICK'S Sporting Goods' net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets |
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Sally Beauty | 3.22% | -535.36% | 4.79% |
DICK'S Sporting Goods | 4.20% | 25.52% | 6.49% |
Summary
DICK'S Sporting Goods beats Sally Beauty on 14 of the 14 factors compared between the two stocks.