Francesca’s Holdings Corporation (NASDAQ: FRAN) and Genesco (NYSE:GCO) are both small-cap consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, analyst recommendations, risk, institutional ownership, valuation, dividends and profitability.

Risk & Volatility

Francesca’s Holdings Corporation has a beta of 0.22, meaning that its stock price is 78% less volatile than the S&P 500. Comparatively, Genesco has a beta of 1.36, meaning that its stock price is 36% more volatile than the S&P 500.

Earnings & Valuation

This table compares Francesca’s Holdings Corporation and Genesco’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Francesca’s Holdings Corporation $493.21 million 0.51 $78.79 million $0.97 7.09
Genesco $2.85 billion 0.18 $184.95 million $3.53 7.32

Genesco has higher revenue and earnings than Francesca’s Holdings Corporation. Francesca’s Holdings Corporation is trading at a lower price-to-earnings ratio than Genesco, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of recent recommendations for Francesca’s Holdings Corporation and Genesco, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Francesca’s Holdings Corporation 0 6 2 0 2.25
Genesco 0 4 3 0 2.43

Francesca’s Holdings Corporation currently has a consensus target price of $13.86, indicating a potential upside of 101.41%. Genesco has a consensus target price of $32.71, indicating a potential upside of 26.55%. Given Francesca’s Holdings Corporation’s higher probable upside, equities analysts clearly believe Francesca’s Holdings Corporation is more favorable than Genesco.

Insider and Institutional Ownership

93.6% of Genesco shares are owned by institutional investors. 1.2% of Francesca’s Holdings Corporation shares are owned by company insiders. Comparatively, 3.3% of Genesco shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Profitability

This table compares Francesca’s Holdings Corporation and Genesco’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Francesca’s Holdings Corporation 7.28% 31.88% 18.83%
Genesco 2.43% 7.36% 4.34%

Summary

Genesco beats Francesca’s Holdings Corporation on 9 of the 14 factors compared between the two stocks.

About Francesca’s Holdings Corporation

Francesca’s Holdings Corporation is a holding company. The Company is a specialty retailer, which operates a chain of boutiques across the United States. The Company offers a mix of apparel, jewelry, accessories and gifts. As of January 28, 2017, the Company operated 671 boutiques in 48 states and the District of Columbia, and also served its customers through www.francescas.com, its e-commerce Website. The Company offers apparel, such as dresses, fashion tops, sweaters, cardigans and wraps, bottoms, outerwear and jackets, tees and tanks, and intimates. The Company provides jewelry, such as necklaces, earrings, bracelets and rings. The Company offers accessories, such as handbags, clutches, wallets, shoes, belts, hats, scarves, sunglasses, watches and hair accessories. The Company provides gifts, such as fragrance, candles, bath and body, home accessories, books, wall art, nail polish and miscellaneous items. The Company operates its boutiques under the francesca’s brand.

About Genesco

Genesco Inc. is a retailer and wholesaler of footwear, apparel and accessories. The Company operates in five segments: Journeys Group, Schuh Group, Lids Sports Group, Johnston & Murphy Group and Licensed Brands. It relies on independent third-party manufacturers for production of its footwear products sold at wholesale. It sources footwear and accessory products from foreign manufacturers located in Bangladesh, Brazil, Cambodia, Canada, China, Dominican Republic, El Salvador, France, Germany, Hong Kong, India, Indonesia, Italy, Mexico, the Netherlands, Portugal, Peru, Romania, Taiwan and Vietnam. As of January 28, 2017, it operated 2,794 retail footwear, headwear and sports apparel and accessory stores and leased departments located primarily throughout the United States and in Puerto Rico, including 147 headwear and sports apparel and accessory stores and 87 footwear stores in Canada and 128 footwear stores in the United Kingdom, the Republic of Ireland and Germany.

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