Financial Review: Steven Madden (NASDAQ:SHOO) & Xtep International (OTCMKTS:XTEPY)

Xtep International (OTCMKTS:XTEPY) and Steven Madden (NASDAQ:SHOO) are both consumer discretionary companies, but which is the better stock? We will compare the two businesses based on the strength of their profitability, dividends, risk, institutional ownership, valuation, earnings and analyst recommendations.

Insider & Institutional Ownership

99.9% of Steven Madden shares are owned by institutional investors. 2.2% of Steven Madden shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.

Analyst Ratings

This is a breakdown of current recommendations for Xtep International and Steven Madden, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Xtep International	0	1	0	0	2.00
Steven Madden	1	3	5	0	2.44

Steven Madden has a consensus target price of $43.88, indicating a potential upside of 11.10%. Given Steven Madden’s stronger consensus rating and higher probable upside, analysts plainly believe Steven Madden is more favorable than Xtep International.

Valuation and Earnings

This table compares Xtep International and Steven Madden”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Xtep International	$1.97 billion	0.77	$190.79 million	N/A	N/A
Steven Madden	$2.52 billion	1.14	$44.66 million	$1.05	37.61

Xtep International has higher earnings, but lower revenue than Steven Madden.

Dividends

Xtep International pays an annual dividend of $2.29 per share and has a dividend yield of 4.2%. Steven Madden pays an annual dividend of $0.84 per share and has a dividend yield of 2.1%. Steven Madden pays out 80.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares Xtep International and Steven Madden’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Xtep International	N/A	N/A	N/A
Steven Madden	2.89%	12.29%	5.70%

Risk & Volatility

Xtep International has a beta of 0.2, indicating that its share price is 80% less volatile than the S&P 500. Comparatively, Steven Madden has a beta of 1.12, indicating that its share price is 12% more volatile than the S&P 500.

Summary

Steven Madden beats Xtep International on 11 of the 14 factors compared between the two stocks.

About Xtep International

Xtep International Holdings Limited engages in the design, development, manufacture, sale, and marketing and brand management of sports footwear, apparel, and accessories. The company sells its products primarily under the XTEP brand, as well as Palladium, K-Swiss, Saucony, and Merrell brand names. It is also involved in the trading of sportswear products. As of March 18, 2021, the company managed an extensive distribution network with exclusive distributors that operated approximately 6,000 stores covering 31 provinces, autonomous regions, and municipalities in the People's Republic of China and internationally. It also offers its products online. The company was founded in 1999 and is headquartered in Xiamen, the People's Republic of China. Xtep International Holdings Limited is a subsidiary of Group Success Investments Limited.

About Steven Madden

Steven Madden, Ltd. designs, sources, and markets fashion-forward branded and private label footwear, accessories, and apparel in the United States and internationally. It operates through Wholesale Footwear, Wholesale Accessories/Apparel, Direct-to- Consumer, and Licensing segments. The Wholesale Footwear segment designs, sources, and markets various products, including dress shoes, boots, booties, fashion sneakers, sandals, and casual shoes under the Steve Madden, Dolce Vita, Betsey Johnson, Blondo, GREATS, and Anne Klein brands. The Wholesale Accessories/Apparel segment offers handbags, apparel, small leather goods, belts, soft accessories, fashion scarves, wraps, gifting, and other accessories under the Steve Madden, Anne Klein, Betsey Johnson, and Dolce Vita brands. The Direct-to-Consumer segment operates Steve Madden and Dolce Vita full-price retail stores, Steve Madden outlet stores and concessions, and digital e-commerce websites. The Licensing segment engages in the licensing of the Steve Madden and Betsey Johnson trademarks for the sale of select apparel, accessory, home categories, and other non-core products. In addition, the company distributes its products in the wholesale channel through department stores, mass merchants, off-price retailers, shoe chains, online retailers, national chains, specialty retailers, independent stores, and clubs. Further, it markets its products and services through digital brand marketing, social media and influencer marketing, experiential events, in-store and online promotions, and public relations. The company was incorporated in 1990 and is headquartered in Long Island City, New York.