Vera Bradley (NASDAQ:VRA) versus PVH (NYSE:PVH) Critical Analysis

PVH (NYSE:PVH) and Vera Bradley (NASDAQ:VRA) are both consumer discretionary companies, but which is the superior investment? We will contrast the two companies based on the strength of their earnings, dividends, valuation, profitability, risk, analyst recommendations and institutional ownership.

Volatility & Risk

PVH has a beta of 1.76, meaning that its share price is 76% more volatile than the S&P 500. Comparatively, Vera Bradley has a beta of 1.5, meaning that its share price is 50% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and price targets for PVH and Vera Bradley, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
PVH	3	5	6	0	2.21
Vera Bradley	1	0	0	1	2.50

PVH currently has a consensus price target of $87.91, suggesting a potential upside of 5.20%. Given PVH’s higher probable upside, equities research analysts clearly believe PVH is more favorable than Vera Bradley.

Institutional and Insider Ownership

97.3% of PVH shares are held by institutional investors. Comparatively, 59.9% of Vera Bradley shares are held by institutional investors. 1.5% of PVH shares are held by insiders. Comparatively, 14.3% of Vera Bradley shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares PVH and Vera Bradley”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
PVH	$8.95 billion	0.43	$25.30 million	($3.70)	-22.58
Vera Bradley	$269.65 million	0.65	-$47.84 million	($0.37)	-16.41

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

Profitability

This table compares PVH and Vera Bradley’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
PVH	-1.89%	11.94%	5.04%
Vera Bradley	-3.66%	-3.80%	-2.11%

Summary

PVH beats Vera Bradley on 9 of the 15 factors compared between the two stocks.

About PVH

PVH Corp. operates as an apparel company in the United States and internationally. The company operates through Tommy Hilfiger North America, Tommy Hilfiger International, Calvin Klein North America, Calvin Klein International, and Heritage Brands Wholesale segments. It designs and markets men's, women's, and children's branded apparel, footwear and accessories, underwear, sleepwear, outerwear, home furnishings, luggage, dresses, suits and swimwear, activewear, sportswear, socks and accessories, outerwear, golf products, footwear, watches and jewelry, eyeglasses and non-ophthalmic sunglasses, jeans wear, performance apparel, intimate apparel, dress shirts, handbags, fragrance, small leather goods, and other related products; and men's and boy's tailored clothing products, duvets, pillows, mattress pads and toppers, and feather beds. The company offers its products under its own brands, such as TOMMY HILFIGER, TOMMY JEANS, Calvin Klein, CK Calvin Klein, Calvin Klein Jeans, Calvin Klein Underwear, and Calvin Klein Performance, as well as various other owned, licensed, and private label brands. It distributes its products at wholesale in department, chain, and specialty stores; through warehouse clubs, mass market, and off-price and independent retailers; and through company-operated full-price, outlet stores, and concession locations; and through digital commerce sites. PVH Corp. was founded in 1881 and is based in New York, New York.

About Vera Bradley

Vera Bradley, Inc., together with its subsidiaries, designs, manufactures, and sells women’s handbags, luggage and travel items, fashion and home accessories, and gifts. It operates through three segments: Vera Bradley Direct, Vera Bradley Indirect, and Pura Vida. The company offers bag products, such as totes, crossbodies, satchels, clutches, backpacks, baby bags, and lunch bags; accessories, including ID holders, lanyards, wallets, wristlets, eyewear, scarves, hair accessories, and various technology accessories; bracelets, rings, and necklaces under Pura Vida brand name; and travel products consist of rolling luggage, cosmetics, and travel and packing accessories, as well as travel bags comprising duffel and weekend bags. It also provides home products that include throw blankets, beach towels, and comforters, as well as items, such as mugs and tumblers; apparel/footwear comprising sleepwear, footwear, outerwear, tees and hoodies, and socks; and stationery and merchandising products, as well as freight, licensing, and gift card breakage services. The company sells its Vera Bradley branded products through its full-line and outlet stores in the United States; verabradley.com, an online outlet site; its annual outlet sale in Fort Wayne, Indiana. It sells its Pura Vida branded products through wholesale retailers and Pura Vida websites, including www.puravidabracelets.com, www.puravidabracelets.eu, and www.puravidabracelets.ca; and Vera Bradley Indirect branded products to specialty retail locations, department stores, national accounts, third party e-commerce sites, third-party inventory liquidators, and through licensing agreements. Vera Bradley, Inc. was incorporated in 1982 and is headquartered in Roanoke, Indiana.