Financial Analysis: Hennes & Mauritz (OTCMKTS:HNNMY) & Allbirds (NASDAQ:BIRD)

Hennes & Mauritz (OTCMKTS:HNNMY) and Allbirds (NASDAQ:BIRD) are both retail/wholesale companies, but which is the better stock? We will contrast the two companies based on the strength of their dividends, risk, earnings, analyst recommendations, valuation, institutional ownership and profitability.

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Hennes & Mauritz and Allbirds, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hennes & Mauritz	2	4	0	1	2.00
Allbirds	1	2	0	0	1.67

Allbirds has a consensus target price of $8.00, indicating a potential upside of 108.33%. Given Allbirds’ higher probable upside, analysts plainly believe Allbirds is more favorable than Hennes & Mauritz.

Valuation and Earnings

This table compares Hennes & Mauritz and Allbirds”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hennes & Mauritz	$23.01 billion	1.06	$1.23 billion	$0.16	21.63
Allbirds	$152.47 million	0.22	-$77.28 million	($9.12)	-0.42

Hennes & Mauritz has higher revenue and earnings than Allbirds. Allbirds is trading at a lower price-to-earnings ratio than Hennes & Mauritz, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Hennes & Mauritz has a beta of 1.1, indicating that its stock price is 10% more volatile than the S&P 500. Comparatively, Allbirds has a beta of 2.72, indicating that its stock price is 172% more volatile than the S&P 500.

Institutional and Insider Ownership

0.0% of Hennes & Mauritz shares are held by institutional investors. Comparatively, 44.1% of Allbirds shares are held by institutional investors. 30.7% of Allbirds shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Hennes & Mauritz and Allbirds’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hennes & Mauritz	5.48%	30.79%	7.32%
Allbirds	-53.36%	-173.54%	-67.54%

Summary

Hennes & Mauritz beats Allbirds on 10 of the 14 factors compared between the two stocks.

About Hennes & Mauritz

H & M Hennes & Mauritz AB (publ) provides clothing, accessories, footwear, cosmetics, home textiles, and homeware for women, men, and children worldwide. It offers sportswear, shoes, bags, beauty products, activewear, jeans, and ready-to-wear; and interior products, including bed linens, dinnerware, textiles, furniture, and lighting. The company provides its products under the H&M, H&M HOME, H&M Move, H&M Beauty, COS, Weekday, Monki, & Other Stories, ARKET, Afound, and Singular Society brand names. In addition, it operates Sellpy, a broad digital platform for second-hand fashion and other products; and Creator Studio, a global platform for merchandise design and production, as well as provides solutions to extend the useful life of unwanted garments through reuse and recycling under Looper Textile name. The company offers its products through online and physical stores. H & M Hennes & Mauritz AB (publ) was incorporated in 1943 and is headquartered in Stockholm, Sweden.

About Allbirds

Allbirds, Inc. manufactures and sells footwear and apparel products for men and women in the United States and internationally. The company offers a range of lifestyle and performance shoes; and apparel, including classic tees and sweats, socks, and underwear. It sells its products through its retail stores, as well as online. The company was formerly known as Bozz, Inc. and changed its name to Allbirds, Inc. in December 2015. Allbirds, Inc. was incorporated in 2015 and is headquartered in San Francisco, California.