Analyzing Sportsman’s Warehouse (NASDAQ:SPWH) and Shoe Carnival (NASDAQ:SCVL)

Shoe Carnival (NASDAQ:SCVL) and Sportsman’s Warehouse (NASDAQ:SPWH) are both small-cap retail/wholesale companies, but which is the superior business? We will contrast the two companies based on the strength of their valuation, analyst recommendations, earnings, risk, institutional ownership, profitability and dividends.

Profitability

This table compares Shoe Carnival and Sportsman’s Warehouse’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Shoe Carnival	4.60%	7.75%	4.47%
Sportsman’s Warehouse	-3.05%	-7.20%	-1.72%

Institutional and Insider Ownership

66.1% of Shoe Carnival shares are held by institutional investors. Comparatively, 83.0% of Sportsman’s Warehouse shares are held by institutional investors. 35.5% of Shoe Carnival shares are held by company insiders. Comparatively, 1.8% of Sportsman’s Warehouse shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Shoe Carnival and Sportsman’s Warehouse”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Shoe Carnival	$1.14 billion	0.37	$52.27 million	$1.90	8.09
Sportsman’s Warehouse	$1.20 billion	0.04	-$33.06 million	($0.97)	-1.34

Shoe Carnival has higher earnings, but lower revenue than Sportsman’s Warehouse. Sportsman’s Warehouse is trading at a lower price-to-earnings ratio than Shoe Carnival, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current ratings and recommmendations for Shoe Carnival and Sportsman’s Warehouse, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Shoe Carnival	0	2	0	1	2.67
Sportsman’s Warehouse	1	1	4	0	2.50

Shoe Carnival presently has a consensus target price of $22.00, suggesting a potential upside of 43.04%. Sportsman’s Warehouse has a consensus target price of $2.95, suggesting a potential upside of 126.92%. Given Sportsman’s Warehouse’s higher possible upside, analysts clearly believe Sportsman’s Warehouse is more favorable than Shoe Carnival.

Volatility & Risk

Shoe Carnival has a beta of 1.34, meaning that its share price is 34% more volatile than the S&P 500. Comparatively, Sportsman’s Warehouse has a beta of 0.6, meaning that its share price is 40% less volatile than the S&P 500.

Summary

Shoe Carnival beats Sportsman’s Warehouse on 11 of the 15 factors compared between the two stocks.

About Shoe Carnival

Shoe Carnival, Inc., together with its subsidiaries, operates as a family footwear retailer in the United States. The company offers range of dress, casual, work, and athletic shoes, as well as sandals and boots for men, women, and children; and various accessories. The company also operates stores, and sells its products through online shopping at shoecarnival.com, as well as through mobile app. Shoe Carnival, Inc. was founded in 1978 and is headquartered in Evansville, Indiana.

About Sportsman’s Warehouse

Sportsman’s Warehouse Holdings, Inc. engages in the retail of sporting and athletic goods. Its products include hunting and shooting, archery, fishing, camping, boating accessories, optics and electronics, knives and tools, and footwear. The company was founded in 1986 and is headquartered in West Jordan, UT.