Escalade (ESCA) and Sports Direct (SDISY) Critical Analysis

Escalade (NASDAQ: ESCA) and Sports Direct (OTCMKTS:SDISY) are both consumer discretionary companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, earnings, analyst recommendations, dividends, risk, institutional ownership and valuation.

Risk & Volatility

Escalade has a beta of 0.06, meaning that its share price is 94% less volatile than the S&P 500. Comparatively, Sports Direct has a beta of -0.38, meaning that its share price is 138% less volatile than the S&P 500.

Profitability

This table compares Escalade and Sports Direct’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Escalade 7.93% 10.06% 7.08%
Sports Direct N/A N/A N/A

Insider & Institutional Ownership

26.9% of Escalade shares are held by institutional investors. 20.1% of Escalade shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Escalade and Sports Direct, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Escalade 0 0 2 0 3.00
Sports Direct 1 0 0 0 1.00

Escalade currently has a consensus price target of $16.50, suggesting a potential upside of 13.79%. Given Escalade’s stronger consensus rating and higher probable upside, equities research analysts clearly believe Escalade is more favorable than Sports Direct.

Dividends

Escalade pays an annual dividend of $0.50 per share and has a dividend yield of 3.4%. Sports Direct does not pay a dividend. Escalade pays out 64.9% of its earnings in the form of a dividend.

Valuation and Earnings

This table compares Escalade and Sports Direct’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Escalade $177.33 million 1.18 $14.06 million $0.77 18.83
Sports Direct $4.20 billion 0.67 $297.39 million $0.30 34.67

Sports Direct has higher revenue and earnings than Escalade. Escalade is trading at a lower price-to-earnings ratio than Sports Direct, indicating that it is currently the more affordable of the two stocks.

Summary

Escalade beats Sports Direct on 12 of the 15 factors compared between the two stocks.

Escalade Company Profile

Escalade, Incorporated, together with its subsidiaries, manufactures and sells sporting goods in North America, Europe, and internationally. The company manufactures, imports, and distributes various sporting goods brands in basketball goals, archery, indoor and outdoor game recreation, and fitness products. It offers archery products under the Bear Archery, Trophy Ridge, Whisker Biscuit, Cajun Bowfishing, Karnage, Fletcher, and Rocket brand names; table tennis products under the STIGA and Ping-Pong brands; basketball goals under the Goalrilla, Goaliath, Silverback, Hoopstar, and Goalsetter brand names; and trampoline under the Vuly brand. The company also provides play systems under the Woodplay and Childlife brands; fitness products under the USWeight, The STEP, Lifeline, Kettleworx, Natural Fitness, and PER4M brand names; hockey and soccer game tables under the Atomic, American Legend, Redline, and Triumph brands; and billiard accessories under the Mizerak, Minnesota Fats, Lucasi, PureX, Rage, and Players brand names. In addition, it offers darting products under the Unicorn, Accudart, Arachnid, Nodor, and Winmau brands; and outdoor game products under the Zume Games, Pickleball Now, Onix, Viva Sol, and Triumph Sports brand names. The company provides its products through sporting goods retailers, specialty dealers, online retailers, traditional department stores, and mass merchants. Escalade, Incorporated was founded in 1922 and is headquartered in Evansville, Indiana.

Sports Direct Company Profile

Sports Direct International plc, together with its subsidiaries, retails sports and leisure clothing, footwear, equipment, and accessories. It operates through four segments: UK Sports Retail, International Sports Retail, Brands, and Premium Lifestyle. The company is also involved in the wholesale distribution and sale of sports and leisure clothing, footwear, and equipment under company-owned or licensed brands; and licensing activities. It offers its products under its own brands, which include Dunlop, Slazenger, Everlast, Lonsdale, Karrimor, Antigua, Campri, Carlton, Donnay, Gelert, LA Gear, Lillywhites, Muddyfox, Nevica, No Fear, Silver Fox, Sondico, Title, USA PRO, Crafted, Fabric, Firetrap, Full Circle, Golddigga, Hot Tuna, Kangol, Rock & Rags, SoulCal, Soviet, and Voodoo Dolls; and third party brands. The company offers a range of sporting apparel, footwear, and equipment through SPORTSDIRECT.com. In addition, it operates 32 fitness gyms. The company operates 468 sports retail stores in the United Kingdom and 289 internationally. Sports Direct International plc was founded in 1982 and is headquartered in Shirebrook, the United Kingdom.

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