Stein Mart (NASDAQ: SMRT) and XCel Brands (NASDAQ:XELB) are both small-cap retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, dividends, risk, valuation, earnings and institutional ownership.
Volatility & Risk
Stein Mart has a beta of 0.82, meaning that its stock price is 18% less volatile than the S&P 500. Comparatively, XCel Brands has a beta of 0.47, meaning that its stock price is 53% less volatile than the S&P 500.
This table compares Stein Mart and XCel Brands’ net margins, return on equity and return on assets.
||Return on Equity
||Return on Assets
This is a summary of current recommendations and price targets for Stein Mart and XCel Brands, as reported by MarketBeat.com.
||Strong Buy Ratings
XCel Brands has a consensus price target of $4.50, indicating a potential upside of 45.16%. Given XCel Brands’ higher probable upside, analysts clearly believe XCel Brands is more favorable than Stein Mart.
Institutional and Insider Ownership
20.0% of Stein Mart shares are owned by institutional investors. Comparatively, 20.9% of XCel Brands shares are owned by institutional investors. 34.7% of Stein Mart shares are owned by company insiders. Comparatively, 59.9% of XCel Brands shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Stein Mart pays an annual dividend of $0.08 per share and has a dividend yield of 6.9%. XCel Brands does not pay a dividend. Stein Mart pays out -12.9% of its earnings in the form of a dividend.
Valuation and Earnings
This table compares Stein Mart and XCel Brands’ gross revenue, earnings per share (EPS) and valuation.
||Earnings Per Share
XCel Brands has lower revenue, but higher earnings than Stein Mart. Stein Mart is trading at a lower price-to-earnings ratio than XCel Brands, indicating that it is currently the more affordable of the two stocks.
XCel Brands beats Stein Mart on 11 of the 15 factors compared between the two stocks.
Stein Mart Company Profile
Stein Mart, Inc. is a national retailer offering the fashion merchandise, service and presentation of a department or specialty store. The Company offers apparel for women and men, as well as accessories, shoes and home fashions. The Company’s target customers are women over 45 years old. The Company operates approximately 280 stores in over 30 states and an Internet store. Its stores are located in the Northeast, Midwest, Southeast, Texas and the Southwest. It is concentrated in the Southeast and Texas where over 180 of its stores are located. The Company’s stores offer a range of services, such as merchandise locator service, a Preferred Customer program, co-branded and private label credit card programs, and electronic gift cards. The Company’s merchants purchase products from approximately 1,200 vendors. It leases all of its store locations, generally for approximately 10 years with options to extend the lease term for over two or five year periods.
XCel Brands Company Profile
Xcel Brands, Inc. is a brand development and media company. The Company is engaged in the design, production, licensing, marketing, and direct to consumer sales of branded apparel, footwear, accessories, jewelry, home goods, and other consumer products, and the acquisition of consumer lifestyle brands. The Company’s brand portfolio consists of the Isaac Mizrahi, Judith Ripka, H Halston, C Wonder and Highline Collective brands. The Company also manages and designs the Liz Claiborne New York brand (LCNY Brand). Isaac Mizrahi has over 150 different product categories, including sportswear, footwear, handbags, watches, eyewear, fragrance, tech accessories, intimates, bridal gowns and accessories, pet products, home and other merchandise. The Company’s Judith Ripka is a luxury jewelry brand. Wonder brand offers women’s clothing, footwear, jewelry and accessories; housewares, and home decor and gifts. The Liz Claiborne New York includes women’s apparel, footwear, outerwear and accessories.
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