Reviewing Destination Maternity (OTCMKTS:DESTQ) & GAP (NYSE:GAP)

GAP (NYSE:GAP) and Destination Maternity (OTCMKTS:DESTQ) are both retail/wholesale companies, but which is the better investment? We will contrast the two companies based on the strength of their profitability, valuation, institutional ownership, analyst recommendations, earnings, risk and dividends.

Insider & Institutional Ownership

58.8% of GAP shares are owned by institutional investors. 31.0% of GAP shares are owned by insiders. Comparatively, 0.4% of Destination Maternity shares are owned by 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.

Earnings and Valuation

This table compares GAP and Destination Maternity”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
GAP	$15.17 billion	0.60	$844.00 million	$2.34	10.41
Destination Maternity	N/A	N/A	N/A	N/A	N/A

GAP has higher revenue and earnings than Destination Maternity.

Profitability

This table compares GAP and Destination Maternity’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
GAP	5.86%	27.04%	7.49%
Destination Maternity	N/A	N/A	N/A

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for GAP and Destination Maternity, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
GAP	0	10	8	0	2.44
Destination Maternity	0	0	0	0	0.00

GAP currently has a consensus price target of $26.06, indicating a potential upside of 7.04%. Given GAP’s stronger consensus rating and higher probable upside, research analysts clearly believe GAP is more favorable than Destination Maternity.

Summary

GAP beats Destination Maternity on 9 of the 9 factors compared between the two stocks.

About GAP

Gap, Inc. operates as a global apparel retail company, which offers clothing, apparel, accessories, and personal care products for men, women, and children. The firm operates through the following segments: Gap Global, Old Navy Global, Banana Republic Global, Athleta, and Other. The Gap Global segment includes apparel and accessories for men and women under the Gap brand, along with the GapKids, BabyGap, GapMaternity, GapBody, and GapFit collections. The Old Navy Global segment offers clothing and accessories for adults and children. The Banana Republic Global segment provides clothing, eyewear, jewelry, shoes, handbags, and fragrances. The Athleta segment offers fitness apparel for women. The company founded by Donald G. Fisher and Doris F. Fisher in July 1969 and is headquartered in San Francisco, CA.

About Destination Maternity

Destination Maternity Corp. engages in the design, manufacture and sale of maternity apparel and related accessories. It operates stores under three brands: Motherhood Maternity, A Pea in the Pod, and Destination Maternity. The Motherhood Maternity brand serves maternity apparel business, which is used in special occasion, offering quality merchandise at affordable value. The A Pea in the Pod brand is a contemporary, fashion-forward assortment including a curated selection of exclusive designer labels at premium pricing, offering the mom2be fashionable maternity pieces that reflect her uncompromising sense of style in both casual and career apparel. The Destination Maternity brand relates to a selection of fashion offers all three brands, plus skincare, fitness, and nutritional products to pamper the pregnant woman. The company was founded in 1982 and is headquartered in Moorestown, NJ.