Comparing Francesca’s (FRAN) & Tailored Brands (TLRD)

Francesca’s (NASDAQ: FRAN) and Tailored Brands (NYSE:TLRD) are both small-cap consumer discretionary companies, but which is the superior investment? We will compare the two businesses based on the strength of their analyst recommendations, institutional ownership, profitability, earnings, dividends, risk and valuation.

Profitability

This table compares Francesca’s and Tailored Brands’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Francesca’s 3.30% 16.52% 9.72%
Tailored Brands 2.93% -245.27% 5.11%

Valuation and Earnings

This table compares Francesca’s and Tailored Brands’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Francesca’s $471.68 million 0.41 $15.56 million $0.52 10.85
Tailored Brands $3.30 billion 0.52 $96.70 million $2.20 15.55

Tailored Brands has higher revenue and earnings than Francesca’s. Francesca’s is trading at a lower price-to-earnings ratio than Tailored Brands, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings for Francesca’s and Tailored Brands, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Francesca’s 0 5 1 0 2.17
Tailored Brands 0 1 4 0 2.80

Francesca’s presently has a consensus price target of $6.75, suggesting a potential upside of 19.68%. Tailored Brands has a consensus price target of $16.25, suggesting a potential downside of 52.51%. Given Francesca’s’ higher probable upside, analysts plainly believe Francesca’s is more favorable than Tailored Brands.

Dividends

Tailored Brands pays an annual dividend of $0.72 per share and has a dividend yield of 2.1%. Francesca’s does not pay a dividend. Tailored Brands pays out 32.7% of its earnings in the form of a dividend.

Insider & Institutional Ownership

96.9% of Francesca’s shares are held by institutional investors. Comparatively, 99.5% of Tailored Brands shares are held by institutional investors. 1.2% of Francesca’s shares are held by insiders. Comparatively, 2.4% of Tailored Brands shares are held by 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.

Summary

Tailored Brands beats Francesca’s on 10 of the 15 factors compared between the two stocks.

Francesca’s Company Profile

Francesca's Holdings Corporation, through its subsidiaries, operates a chain of retail boutiques. It offers fashion apparel, jewelry, accessories, and gifts primarily for women between the ages of 18 and 35. The company's apparel products comprise dresses, fashion tops, sweaters, cardigans and wraps, bottoms, outerwear and jackets, tees and tanks, and intimates; and jewelry includes necklaces, earrings, bracelets, and rings. Its accessories consist of handbags, clutches, wallets, shoes, belts, hats, scarves, sunglasses, watches, and hair accessories; and gifts include fragrances, candles, bath and body products, home accessories, books, wall art, nail polish, and miscellaneous items. As of March 27, 2018, the company operated 721 boutiques in 47 states and the District of Columbia. The company also sells products through its Website at francescas.com. Francesca's Holdings Corporation was founded in 1999 and is headquartered in Houston, Texas.

Tailored Brands Company Profile

Tailored Brands, Inc. operates as a specialty apparel retailer the United States, Puerto Rico, and Canada. It operates through two segments, Retail and Corporate Apparel. The Retail segment offers suits, suit separates, sport coats, slacks, formalwear, business casual, denim, sportswear, outerwear, dress shirts, shoes, and accessories for men. It also provides women's career and casual apparel, sportswear, and accessories; children's apparel; alteration services; and retail dry cleaning, laundry, and heirlooming services. As of February 3, 2018, this segment operated 1,477 stores under the Men's Wearhouse, Men's Wearhouse and Tux, Jos. A. Bank, Moores, Joseph Abboud, and K&G; and 38 retail dry cleaning, laundry, and heirlooming facilities. The Corporate Apparel segment provides corporate apparel uniforms and work wear to workforces under the Dimensions, Alexandra, Yaffy, and Twin Hill brands through various channels, including managed corporate accounts and catalogs, as well as through dimensions.co.uk, alexandra.co.uk, and twinhill.com Internet sites. This segment serves companies and organizations in the airline, retail grocery, retail, banking, quick service restaurant, car rental, distribution, travel and leisure, postal, security, healthcare, and public sectors. The company was formerly known as The Men's Wearhouse, Inc. and changed its name to Tailored Brands, Inc. in February 2016. Tailored Brands, Inc. was founded in 1973 and is based in Houston, Texas.

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