Head-To-Head Comparison: Ascena Retail Group (ASNA) vs. Carter's (CRI)

Ascena Retail Group (NASDAQ: ASNA) and Carter's (NYSE:CRI) are both retail/wholesale companies, but which is the superior business? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, analyst recommendations, risk, dividends and valuation.

Dividends

Carter's pays an annual dividend of $1.48 per share and has a dividend yield of 1.2%. Ascena Retail Group does not pay a dividend. Carter's pays out 28.5% of its earnings in the form of a dividend. Carter's has raised its dividend for 4 consecutive years.

Valuation & Earnings

This table compares Ascena Retail Group and Carter's’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ascena Retail Group $6.65 billion 0.06 -$1.07 billion ($5.52) -0.38
Carter's $3.20 billion 1.76 $258.10 million $5.20 22.88

Carter's has lower revenue, but higher earnings than Ascena Retail Group. Ascena Retail Group is trading at a lower price-to-earnings ratio than Carter's, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Ascena Retail Group and Carter's’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ascena Retail Group -16.39% 2.50% 0.64%
Carter's 7.69% 33.38% 12.91%

Risk & Volatility

Ascena Retail Group has a beta of 1.96, meaning that its stock price is 96% more volatile than the S&P 500. Comparatively, Carter's has a beta of 0.37, meaning that its stock price is 63% less volatile than the S&P 500.

Institutional & Insider Ownership

94.9% of Ascena Retail Group shares are owned by institutional investors. Comparatively, 98.7% of Carter's shares are owned by institutional investors. 8.0% of Ascena Retail Group shares are owned by company insiders. Comparatively, 3.1% of Carter's shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of current ratings and target prices for Ascena Retail Group and Carter's, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ascena Retail Group 1 8 0 0 1.89
Carter's 0 5 9 0 2.64

Ascena Retail Group presently has a consensus target price of $2.75, suggesting a potential upside of 29.72%. Carter's has a consensus target price of $110.31, suggesting a potential downside of 7.27%. Given Ascena Retail Group’s higher possible upside, equities research analysts plainly believe Ascena Retail Group is more favorable than Carter's.

Summary

Carter's beats Ascena Retail Group on 12 of the 17 factors compared between the two stocks.

Ascena Retail Group Company Profile

Ascena Retail Group, Inc. is a specialty retailer of apparel for women and tween girls. The Company operates through six segments: ANN, Justice, Lane Bryant, maurices, dressbarn and Catherines. The ANN segment offers feminine classics and fashion choices, sold primarily under the Ann Taylor and LOFT brands. The Justice segment offers apparel to girls who are aged 6 to 12. The Lane Bryant segment offers apparel to female customers in plus-sizes 14-28. The maurices segment offers women’s casual clothing, career wear, dressy apparel, active wear and accessories. The dressbarn segment consists of the specialty retail, outlet and e-commerce operations of the dressbarn brand. The Catherines segment offers classic apparel and accessories to female customers for wear-to-work and casual lifestyles. As of July 30, 2016, the Company operated approximately 4,900 stores in 49 United States’ states, the District of Columbia, Canada and Puerto Rico.

Carter's Company Profile

Carter’s, Inc. (Carter’s) is a marketer of apparel for babies and young children in the United States and Canada. The Company owns two brand names in the children’s apparel industry, Carter’s and OshKosh B’gosh (OshKosh). The Company operates through five segments: Carter’s Retail, Carter’s Wholesale, OshKosh Retail, OshKosh Wholesale and International. Its International segment includes company-operated retail stores and online Websites, wholesale operations, and royalty income from its international licensees. It markets products for consumers, and offer various product categories, including baby, sleepwear, play clothes, and related accessories. Its multi-channel international business model – retail stores, online and wholesale – enables it to reach a range of consumers around the world. As of December 31, 2016, its channels included approximately 18,000 wholesale locations, 792 stores in the United States, 164 stores in Canada, and its Canadian and the United States Websites.

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