Contrasting DICK’S Sporting Goods (NYSE:DKS) and Lulu’s Fashion Lounge (NASDAQ:LVLU)

DICK’S Sporting Goods (NYSE:DKS) and Lulu’s Fashion Lounge (NASDAQ:LVLU) are both consumer discretionary companies, but which is the better business? We will contrast the two businesses based on the strength of their risk, valuation, analyst recommendations, dividends, institutional ownership, profitability and earnings.

Analyst Ratings

This is a breakdown of current recommendations for DICK’S Sporting Goods and Lulu’s Fashion Lounge, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DICK’S Sporting Goods	3	9	12	0	2.38
Lulu’s Fashion Lounge	1	0	0	0	1.00

DICK’S Sporting Goods presently has a consensus target price of $167.53, suggesting a potential upside of 16.53%. Given DICK’S Sporting Goods’ stronger consensus rating and higher possible upside, analysts clearly believe DICK’S Sporting Goods is more favorable than Lulu’s Fashion Lounge.

Volatility & Risk

DICK’S Sporting Goods has a beta of 1.09, indicating that its share price is 9% more volatile than the S&P 500. Comparatively, Lulu’s Fashion Lounge has a beta of 0.27, indicating that its share price is 73% less volatile than the S&P 500.

Profitability

This table compares DICK’S Sporting Goods and Lulu’s Fashion Lounge’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DICK’S Sporting Goods	3.97%	19.21%	6.07%
Lulu’s Fashion Lounge	-3.17%	-946.15%	-8.73%

Institutional and Insider Ownership

89.8% of DICK’S Sporting Goods shares are owned by institutional investors. Comparatively, 73.8% of Lulu’s Fashion Lounge shares are owned by institutional investors. 28.9% of DICK’S Sporting Goods shares are owned by company insiders. Comparatively, 7.8% of Lulu’s Fashion Lounge shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares DICK’S Sporting Goods and Lulu’s Fashion Lounge”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DICK’S Sporting Goods	$17.22 billion	0.74	$849.24 million	$9.31	15.44
Lulu’s Fashion Lounge	$282.28 million	0.12	-$13.71 million	($2.94)	-3.88

DICK’S Sporting Goods has higher revenue and earnings than Lulu’s Fashion Lounge. Lulu’s Fashion Lounge is trading at a lower price-to-earnings ratio than DICK’S Sporting Goods, indicating that it is currently the more affordable of the two stocks.

Summary

DICK’S Sporting Goods beats Lulu’s Fashion Lounge on 14 of the 14 factors compared between the two stocks.

About DICK’S Sporting Goods

DICK’s Sporting Goods, Inc. engages in the retailing of an extensive assortment of authentic sports equipment, apparel, footwear, and accessories. It also offers its products both online and through mobile applications. The company was founded by Richard T. Stack in 1948 and is headquartered in Coraopolis, PA.

About Lulu’s Fashion Lounge

Lulu’s Fashion Lounge Holdings, Inc. engages in providing an online website for clothing. It offers retailing of women’s clothing, shoes, and accessories. The company was founded in 1996 and is headquartered in Chico, CA.