Critical Comparison: Ethan Allen Interiors (NYSE:ETH) & Stanley Furniture Company (STLY)
Stanley Furniture Company (NASDAQ: STLY) and Ethan Allen Interiors (NYSE:ETH) are both small-cap consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their risk, dividends, earnings, profitabiliy, analyst recommendations, institutional ownership and valuation.
Insider and Institutional Ownership
30.8% of Stanley Furniture Company shares are held by institutional investors. Comparatively, 99.3% of Ethan Allen Interiors shares are held by institutional investors. 28.6% of Stanley Furniture Company shares are held by company insiders. Comparatively, 11.0% of Ethan Allen Interiors shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.
This table compares Stanley Furniture Company and Ethan Allen Interiors’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Stanley Furniture Company||-9.50%||-19.43%||-12.29%|
|Ethan Allen Interiors||5.33%||11.31%||7.74%|
Risk & Volatility
Stanley Furniture Company has a beta of 0.35, suggesting that its share price is 65% less volatile than the S&P 500. Comparatively, Ethan Allen Interiors has a beta of 1.16, suggesting that its share price is 16% more volatile than the S&P 500.
Earnings & Valuation
This table compares Stanley Furniture Company and Ethan Allen Interiors’ gross revenue, earnings per share and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Stanley Furniture Company||$44.08 million||0.40||-$4.75 million||($0.30)||-4.03|
|Ethan Allen Interiors||$774.15 million||1.09||$84.86 million||$1.47||20.82|
Ethan Allen Interiors has higher revenue and earnings than Stanley Furniture Company. Stanley Furniture Company is trading at a lower price-to-earnings ratio than Ethan Allen Interiors, indicating that it is currently the more affordable of the two stocks.
This is a breakdown of current ratings and recommmendations for Stanley Furniture Company and Ethan Allen Interiors, as provided by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Stanley Furniture Company||0||0||0||0||N/A|
|Ethan Allen Interiors||0||5||1||1||2.43|
Ethan Allen Interiors has a consensus target price of $35.00, indicating a potential upside of 14.38%. Given Ethan Allen Interiors’ higher probable upside, analysts plainly believe Ethan Allen Interiors is more favorable than Stanley Furniture Company.
Ethan Allen Interiors pays an annual dividend of $0.76 per share and has a dividend yield of 2.5%. Stanley Furniture Company does not pay a dividend. Ethan Allen Interiors pays out 51.7% of its earnings in the form of a dividend. Stanley Furniture Company has raised its dividend for 6 consecutive years.
Ethan Allen Interiors beats Stanley Furniture Company on 13 of the 16 factors compared between the two stocks.
About Stanley Furniture Company
Stanley Furniture Company, Inc. is a design, marketing and sourcing resource in the wood residential furniture market. The Company’s segment is sale of residential wood furniture products. The Company markets its brands through a network of brick-and-mortar furniture retailers, online retailers and interior designers around the world. The Company’s products are marketed under the Stanley Furniture brand, but also under sub-brands, including Coastal Living and Stone & Leigh. The Company’s products are marketed as wood residential home furnishings and include a range of offerings for the home, including dining, bedroom, living room, home office, home entertainment, accent items, and nursery and youth furniture. The Company provides products in a range of wood species and finishes. The Company’s product is sourced from independently owned factories in Southeast Asia, primarily in Vietnam.
About Ethan Allen Interiors
Ethan Allen Interiors Inc. is an interior design company. The Company is a manufacturer and retailer of home furnishings. The Company operates through two segments, which include wholesale and retail. The Company is an international home fashion brand doing business in North America, Europe, Asia and the Middle East. It offers complimentary interior design service to its clients and sells a range of furniture products and decorative accents through ethanallen.com and a network of design centers in the United States and abroad. Its wholesale segment, principally involved in the development of the Ethan Allen brand, encompasses various aspects of design, manufacture, sourcing, sale, and distribution of its range of home furnishings and accents. The Company’s retail segment sells home furnishings and accents to consumers through a network of Company-operated design centers. As of June 30, 2016, the Company owned and operated nine manufacturing facilities.
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