XCel Brands (NASDAQ: XELB) and Urban Outfitters (NASDAQ:URBN) are both cyclical consumer goods & services companies, but which is the better stock? We will compare the two businesses based on the strength of their institutional ownership, risk, valuation, earnings, analyst recommendations, profitability and dividends.

Profitability

This table compares XCel Brands and Urban Outfitters’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
XCel Brands 2.54% 0.80% 0.58%
Urban Outfitters 4.92% 13.61% 9.27%

Institutional & Insider Ownership

17.3% of XCel Brands shares are owned by institutional investors. Comparatively, 87.6% of Urban Outfitters shares are owned by institutional investors. 59.9% of XCel Brands shares are owned by company insiders. Comparatively, 26.3% of Urban Outfitters shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares XCel Brands and Urban Outfitters’ gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
XCel Brands $32.08 million 1.84 $4.00 million $0.14 26.43
Urban Outfitters $3.53 billion 0.79 $407.95 million $1.49 16.04

Urban Outfitters has higher revenue and earnings than XCel Brands. Urban Outfitters is trading at a lower price-to-earnings ratio than XCel Brands, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

XCel Brands has a beta of 0.67, suggesting that its share price is 33% less volatile than the S&P 500. Comparatively, Urban Outfitters has a beta of 0.59, suggesting that its share price is 41% less volatile than the S&P 500.

Analyst Ratings

This is a summary of current ratings and target prices for XCel Brands and Urban Outfitters, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
XCel Brands 0 0 1 0 3.00
Urban Outfitters 2 17 6 0 2.16

XCel Brands currently has a consensus price target of $4.50, indicating a potential upside of 21.62%. Urban Outfitters has a consensus price target of $21.95, indicating a potential downside of 8.14%. Given XCel Brands’ stronger consensus rating and higher probable upside, equities analysts clearly believe XCel Brands is more favorable than Urban Outfitters.

Summary

Urban Outfitters beats XCel Brands on 8 of the 14 factors compared between the two stocks.

XCel Brands Company Profile

Xcel Brands, Inc. is a brand development and media company. The Company is engaged in the design, production, licensing, marketing, and direct to consumer sales of branded apparel, footwear, accessories, jewelry, home goods, and other consumer products, and the acquisition of consumer lifestyle brands. The Company’s brand portfolio consists of the Isaac Mizrahi, Judith Ripka, H Halston, C Wonder and Highline Collective brands. The Company also manages and designs the Liz Claiborne New York brand (LCNY Brand). Isaac Mizrahi has over 150 different product categories, including sportswear, footwear, handbags, watches, eyewear, fragrance, tech accessories, intimates, bridal gowns and accessories, pet products, home and other merchandise. The Company’s Judith Ripka is a luxury jewelry brand. Wonder brand offers women’s clothing, footwear, jewelry and accessories; housewares, and home decor and gifts. The Liz Claiborne New York includes women’s apparel, footwear, outerwear and accessories.

Urban Outfitters Company Profile

Urban Outfitters, Inc. is a lifestyle specialty retail company. The Company operates through two segments: Retail and Wholesale. The Company’s Retail segment consists of its Urban Outfitters, Anthropologie, Free People, Terrain and Bhldn brands, whose merchandise is sold to its customers through retail stores, Websites, mobile applications, catalogs and customer contact centers. The Retail segment also includes Vetri Family, which operates restaurants under the names Amis, Alla Spina, Lo Spiedo, Pizzeria Vetri and Osteria. Its Wholesale segment consists of the Free People wholesale division that primarily designs, develops and markets young women’s contemporary casual apparel and shoes through individual and chain specialty stores and department stores. The Company’s Wholesale segment includes Free People-branded tops, bottoms, sweaters, dresses, intimates, shoes and activewear, which are sold through department and specialty stores around the world, and its Free People stores.

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