Analyzing ON (NYSE:ONON) and Zumiez (NASDAQ:ZUMZ)

Zumiez (NASDAQ:ZUMZ) and ON (NYSE:ONON) are both retail/wholesale companies, but which is the better business? We will contrast the two businesses based on the strength of their dividends, analyst recommendations, earnings, institutional ownership, risk, profitability and valuation.

Profitability

This table compares Zumiez and ON’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Zumiez	0.94%	2.33%	1.14%
ON	7.45%	14.81%	8.48%

Analyst Ratings

This is a breakdown of current recommendations and price targets for Zumiez and ON, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Zumiez	0	2	0	1	2.67
ON	2	3	17	3	2.84

Zumiez currently has a consensus target price of $18.00, indicating a potential downside of 27.65%. ON has a consensus target price of $60.14, indicating a potential upside of 30.87%. Given ON’s stronger consensus rating and higher possible upside, analysts clearly believe ON is more favorable than Zumiez.

Volatility & Risk

Zumiez has a beta of 0.86, indicating that its stock price is 14% less volatile than the S&P 500. Comparatively, ON has a beta of 2.15, indicating that its stock price is 115% more volatile than the S&P 500.

Institutional & Insider Ownership

95.4% of Zumiez shares are owned by institutional investors. Comparatively, 36.4% of ON shares are owned by institutional investors. 21.2% of Zumiez shares are owned by company insiders. Comparatively, 68.6% of ON shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Zumiez and ON”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Zumiez	$916.91 million	0.46	-$1.71 million	$0.48	51.83
ON	$2.88 billion	10.03	$275.23 million	$0.77	59.68

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

Summary

ON beats Zumiez on 14 of the 15 factors compared between the two stocks.

About Zumiez

Zumiez Inc. operates as a specialty retailer of apparel, footwear, accessories, and hardgoods for young men and women. The company provides hardgoods, including skateboards, snowboards, bindings, components, and other equipment. It operates stores in the United States, Canada, Europe, and Australia under the names of Zumiez, Blue Tomato, and Fast Times. It operates zumiez.com, zumiez.ca, blue-tomato.com, and fasttimes.com.au e-commerce websites. Zumiez Inc. was founded in 1978 and is headquartered in Lynnwood, Washington.

About ON

On Holding AG engages in the development and distribution of sports products such as footwear, apparel, and accessories for high-performance running, outdoor, all-day activities, and tennis. It sells its products worldwide through independent retailers and global distributors, its own online presence, and its own stores. The company was founded by David Allemann, Olivier Bernhard, and Caspar Coppetti in January 2010 and is headquartered in Zurich, Switzerland.