Critical Review: Duluth (NASDAQ:DLTH) versus Barnes & Noble Education (NYSE:BNED)

Duluth (NASDAQ:DLTH) and Barnes & Noble Education (NYSE:BNED) are both small-cap consumer discretionary companies, but which is the better stock? We will compare the two companies based on the strength of their risk, analyst recommendations, institutional ownership, valuation, dividends, earnings and profitability.

Analyst Ratings

This is a breakdown of recent ratings for Duluth and Barnes & Noble Education, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Duluth	0	3	0	0	2.00
Barnes & Noble Education	1	1	2	0	2.25

Duluth presently has a consensus target price of $5.00, indicating a potential upside of 25.34%. Barnes & Noble Education has a consensus target price of $17.25, indicating a potential upside of 38.89%. Given Barnes & Noble Education’s stronger consensus rating and higher probable upside, analysts clearly believe Barnes & Noble Education is more favorable than Duluth.

Volatility and Risk

Duluth has a beta of 1.35, meaning that its stock price is 35% more volatile than the S&P 500. Comparatively, Barnes & Noble Education has a beta of 1.44, meaning that its stock price is 44% more volatile than the S&P 500.

Institutional & Insider Ownership

24.4% of Duluth shares are held by institutional investors. Comparatively, 38.5% of Barnes & Noble Education shares are held by institutional investors. 40.4% of Duluth shares are held by insiders. Comparatively, 1.7% of Barnes & Noble Education shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Duluth and Barnes & Noble Education”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Duluth	$565.18 million	0.27	-$16.39 million	$0.14	28.49
Barnes & Noble Education	$1.71 billion	0.25	$16.87 million	$0.64	19.41

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

Profitability

This table compares Duluth and Barnes & Noble Education’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Duluth	1.07%	-3.03%	-1.21%
Barnes & Noble Education	1.29%	8.77%	2.66%

Summary

Barnes & Noble Education beats Duluth on 11 of the 14 factors compared between the two stocks.

About Duluth

Duluth Holdings Inc. sells casual wear, workwear, and accessories for men and women under the Duluth Trading brand in the United States. It provides shirts, pants, underwear, tanks, outerwear, footwear, accessories, and hard goods. The company offers its products under various trademarks, trade names, and service marks, including Alaskan Hardgear, Armachillo, Ballroom, Bucket Master, Cab Commander, Crouch Gusset, Dry on the Fly, Duluth Trading Co, Duluthflex, Fire Hose, Longtail T, No-Yank, No Polo Shirt, Wild Boar Mocs, and Buck Naked. Duluth Holdings Inc. markets its products through its Website, catalogs, and retail stores. As of May 17, 2018, it operated 36 retail stores. The company was formerly known as GEMPLER'S, Inc. Duluth Holdings Inc. was founded in 1989 and is headquartered in Belleville, Wisconsin.

About Barnes & Noble Education

Barnes and Noble Education, Inc. engages in the management and operation of bookstore chains in universities. It operates through the Retail and Wholesale segments. The Retail segment operates college, university, and K-12 school bookstores, physical bookstores, and virtual bookstores. The Wholesale segment sells and distributes new and used textbooks to physical bookstores. The company was founded by Leonard S, Riggio in 1965 and is headquartered in Basking Ridge, NJ.