Analyzing Lands’ End (NASDAQ:LE) and Chewy (NYSE:CHWY)

Chewy (NYSE:CHWY) and Lands’ End (NASDAQ:LE) are both consumer discretionary companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, dividends, valuation, risk, earnings, profitability and institutional ownership.

Insider and Institutional Ownership

93.1% of Chewy shares are owned by institutional investors. Comparatively, 37.5% of Lands’ End shares are owned by institutional investors. 0.3% of Chewy shares are owned by company insiders. Comparatively, 2.1% of Lands’ End shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Earnings and Valuation

This table compares Chewy and Lands’ End”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Chewy	$12.60 billion	0.67	$222.80 million	$0.66	31.23
Lands’ End	$1.34 billion	0.22	$5.51 million	$11.24	0.90

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

Profitability

This table compares Chewy and Lands’ End’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Chewy	2.09%	60.88%	7.83%
Lands’ End	26.62%	7.96%	3.38%

Volatility & Risk

Chewy has a beta of 1.42, suggesting that its stock price is 42% more volatile than the S&P 500. Comparatively, Lands’ End has a beta of 2.32, suggesting that its stock price is 132% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Chewy and Lands’ End, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Chewy	1	7	17	1	2.69
Lands’ End	0	1	1	0	2.50

Chewy presently has a consensus target price of $30.64, suggesting a potential upside of 48.61%. Lands’ End has a consensus target price of $20.00, suggesting a potential upside of 98.61%. Given Lands’ End’s higher probable upside, analysts clearly believe Lands’ End is more favorable than Chewy.

Summary

Chewy beats Lands’ End on 10 of the 15 factors compared between the two stocks.

About Chewy

Chewy, Inc., together with its subsidiaries, engages in the pure play e-commerce business in the United States. It provides pet food and treats, pet supplies and pet medications, and other pet-health products, as well as pet services for dogs, cats, fish, birds, small pets, horses, and reptiles through its retail websites and mobile applications. The company was founded in 2010 and is based in Plantation, Florida.

About Lands’ End

Lands’ End, Inc. operates as a digital retailer of apparel, swimwear, outerwear, accessories, footwear, home products, and uniform in the United States, Europe, Asia, and internationally. It operates through U.S. eCommerce, International, Outfitters, Third Party, and Retail segments. The company also sells uniform and logo apparel. It sells its products through e-commerce and company operated stores, as well as through third party distribution channels under the Lands’ End, Lands’ End Lighthouse, Squall, Tugless Tank, Drifter, Outrigger, and Marinac, Beach Living brands, as well as Supima, No-Gape, Starfish, Little Black Suit, Iron Knees, Hyde Park, Year’ Rounder, ClassMate, Willis & Geiger, and ThermaCheck brands. Lands’ End, Inc. was founded in 1963 and is headquartered in Dodgeville, Wisconsin.