Comparing Deckers Outdoor (NYSE:DECK) & Adidas (OTCMKTS:ADDYY)

Deckers Outdoor (NYSE:DECK) and Adidas (OTCMKTS:ADDYY) are both large-cap consumer discretionary companies, but which is the superior business? We will compare the two companies based on the strength of their dividends, valuation, institutional ownership, analyst recommendations, earnings, risk and profitability.

Insider & Institutional Ownership

97.8% of Deckers Outdoor shares are held by institutional investors. 0.4% of Deckers Outdoor shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Deckers Outdoor and Adidas’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Deckers Outdoor	19.18%	42.42%	26.45%
Adidas	5.30%	22.35%	6.80%

Volatility & Risk

Deckers Outdoor has a beta of 1.12, suggesting that its stock price is 12% more volatile than the S&P 500. Comparatively, Adidas has a beta of 1.24, suggesting that its stock price is 24% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Deckers Outdoor and Adidas, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Deckers Outdoor	4	11	10	0	2.24
Adidas	2	2	10	1	2.67

Deckers Outdoor presently has a consensus price target of $105.81, suggesting a potential upside of 31.07%. Adidas has a consensus price target of $146.00, suggesting a potential upside of 65.31%. Given Adidas’ stronger consensus rating and higher possible upside, analysts clearly believe Adidas is more favorable than Deckers Outdoor.

Earnings & Valuation

This table compares Deckers Outdoor and Adidas”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Deckers Outdoor	$5.47 billion	2.01	$1.02 billion	$7.54	10.71
Adidas	$28.06 billion	1.12	$1.52 billion	$4.54	19.45

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

About Deckers Outdoor

Deckers Outdoor Corporation, together with its subsidiaries, designs, markets, and distributes footwear, apparel, and accessories for casual lifestyle use and high-performance activities in the United States and internationally. The company offers premium footwear, apparel, and accessories under the UGG brand name; footwear, apparel, and accessories for ultra-runners and athletes under the HOKA brand name; and sandals, shoes, and boots under the Teva brand name. It also provides relaxed casual shoes and sandals under the Sanuk brand name; casual footwear fashion line under the Koolaburra brand name; and footwear under the AHNU brand name. The company sells its products through domestic and international retailers; international distributors; and directly to its consumers through its direct-to-consumer business, which includes e-commerce websites and retail stores. Deckers Outdoor Corporation was founded in 1973 and is headquartered in Goleta, California.

About Adidas

adidas AG, together with its subsidiaries, designs, develops, produces, and markets athletic and sports lifestyle products in Europe, the Middle East, Africa, North America, Greater China, the Asia-Pacific, and Latin America. It offers footwear, apparel, and accessories and gear, such as bags and balls under the adidas brand; golf footwear and apparel under the adidas Golf brand; and outdoor footwear under the Five Ten brand. It sells its products through its own retail stores; mono-branded franchise stores and shop-in-shops; and wholesale and its e-commerce channels. The company was formerly known as adidas-Salomon AG and changed its name to adidas AG in June 2006. adidas AG was founded in 1920 and is headquartered in Herzogenaurach, Germany.