Critical Contrast: Dillard’s (DDS) versus The Competition

Dillard’s (NYSE:DDS) is one of 142 publicly-traded companies in the “Broadline Retail” industry, but how does it contrast to its competitors? We will compare Dillard’s to similar businesses based on the strength of its analyst recommendations, risk, valuation, profitability, institutional ownership, dividends and earnings.

Profitability

This table compares Dillard’s and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Dillard’s	10.09%	31.43%	15.63%
Dillard’s Competitors	-3.17%	-34.71%	-1.48%

Volatility and Risk

Dillard’s has a beta of 1.15, meaning that its stock price is 15% more volatile than the S&P 500. Comparatively, Dillard’s’ competitors have a beta of -1.27, meaning that their average stock price is 227% less volatile than the S&P 500.

Valuation & Earnings

This table compares Dillard’s and its competitors revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Dillard’s	$6.60 billion	$570.19 million	14.88
Dillard’s Competitors	$22.54 billion	$1.73 billion	-220.56

Dillard’s’ competitors have higher revenue and earnings than Dillard’s. Dillard’s is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Insider and Institutional Ownership

67.2% of Dillard’s shares are owned by institutional investors. Comparatively, 44.4% of shares of all “Broadline Retail” companies are owned by institutional investors. 34.8% of Dillard’s shares are owned by company insiders. Comparatively, 24.0% of shares of all “Broadline Retail” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Dillard’s and its competitors, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Dillard’s	2	3	0	0	1.60
Dillard’s Competitors	1356	5319	10702	295	2.56

Dillard’s currently has a consensus price target of $521.33, indicating a potential downside of 16.71%. As a group, “Broadline Retail” companies have a potential upside of 18.13%. Given Dillard’s’ competitors stronger consensus rating and higher probable upside, analysts plainly believe Dillard’s has less favorable growth aspects than its competitors.

Dividends

Dillard’s pays an annual dividend of $1.20 per share and has a dividend yield of 0.2%. Dillard’s pays out 2.9% of its earnings in the form of a dividend. As a group, “Broadline Retail” companies pay a dividend yield of 31.8% and pay out 12.4% of their earnings in the form of a dividend. Dillard’s has increased its dividend for 14 consecutive years.

Summary

Dillard’s beats its competitors on 8 of the 15 factors compared.

Dillard’s Company Profile

Dillard’s, Inc. engages in the retail of fashion apparel, cosmetics, and home furnishings, and other consumer goods. It operates through the Retail Operations and Construction segments. The Retail Operations segment comprises sells cosmetics, ladies’ apparel, ladies’ accessories and lingerie, juniors’ and children’s apparel, men’s apparel and accessories, shoes, and home and furniture products. The Construction segment constructs and remodels stores through CDI Contractors, LLC. The company was founded by William Thomas Dillard in 1938 and is headquartered in Little Rock, AR.