Differential Brands Group (NASDAQ: DFBG) and Gildan Activewear (NYSE:GIL) are both consumer discretionary companies, but which is the better investment? We will contrast the two businesses based on the strength of their risk, analyst recommendations, profitabiliy, dividends, valuation, institutional ownership and earnings.

Volatility and Risk

Differential Brands Group has a beta of -1.72, meaning that its share price is 272% less volatile than the S&P 500. Comparatively, Gildan Activewear has a beta of 0.72, meaning that its share price is 28% less volatile than the S&P 500.

Earnings and Valuation

This table compares Differential Brands Group and Gildan Activewear’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Differential Brands Group $155.65 million 0.16 $3.42 million ($1.06) -1.75
Gildan Activewear $2.68 billion 2.53 $567.29 million $1.65 18.28

Gildan Activewear has higher revenue and earnings than Differential Brands Group. Differential Brands Group is trading at a lower price-to-earnings ratio than Gildan Activewear, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Differential Brands Group and Gildan Activewear’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Differential Brands Group -8.79% -23.53% -6.57%
Gildan Activewear 14.16% 18.65% 12.68%

Dividends

Gildan Activewear pays an annual dividend of $0.37 per share and has a dividend yield of 1.2%. Differential Brands Group does not pay a dividend. Gildan Activewear pays out 22.4% of its earnings in the form of a dividend. Gildan Activewear has raised its dividend for 4 consecutive years.

Insider and Institutional Ownership

1.7% of Differential Brands Group shares are held by institutional investors. Comparatively, 77.2% of Gildan Activewear shares are held by institutional investors. 62.5% of Differential Brands Group shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Differential Brands Group and Gildan Activewear, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Differential Brands Group 0 0 1 0 3.00
Gildan Activewear 0 6 4 0 2.40

Differential Brands Group presently has a consensus target price of $5.00, indicating a potential upside of 170.27%. Gildan Activewear has a consensus target price of $35.33, indicating a potential upside of 17.11%. Given Differential Brands Group’s stronger consensus rating and higher probable upside, analysts clearly believe Differential Brands Group is more favorable than Gildan Activewear.

Summary

Gildan Activewear beats Differential Brands Group on 12 of the 16 factors compared between the two stocks.

About Differential Brands Group

Differential Brands Group Inc., formerly Joe’s Jeans Inc., is engaged in the design, development and marketing of apparel products, which include denim jeans, related casual wear and accessories. The Company offers its products under various brands, such as Hudson, Robert Graham and SWIMS. Its segments are Wholesale and Retail. Its Wholesale segment consists of sales of Hudson products to retailers, specialty stores and international distributors. Its Retail segment consists of sales of its products to consumers through its retail Internet sites for Hudson products. The Hudson product line includes women’s, men’s and children’s denim jeans, pants and other bottoms. The Robert Graham product line includes men’s sport shirts, pants, sweaters, knits, t-shirts, sportcoats, outerwear and swimwear. Through SWIMS brand, it distributes a range of footwear, swimwear, outerwear, ready-to-wear and accessories across the world through department stores, independent specialty and luxury resorts.

About Gildan Activewear

Gildan Activewear Inc. is a manufacturer and marketer of branded basic family apparel, including T-shirts, fleece, sport shirts, underwear, socks, hosiery and shapewear. The Company operates through two segments: Printwear and Branded Apparel. The Printwear segment designs, manufactures, sources, markets, and distributes undecorated activewear products. The Branded Apparel segment designs, manufactures, sources, markets, and distributes branded family apparel, which includes athletic, casual and dress socks, underwear, activewear, sheer hosiery, legwear, and shapewear products, which are sold to retailers in the United States and Canada. The Company sells its products under various brands, including the Gildan, Gold Toe, Anvil, Comfort Colors, American Apparel, Alstyle, Secret, Silks, Kushyfoot, Secret Silky, Therapy Plus, Peds, and MediPeds brands. The Company distributes its products in printwear markets in the United States, Canada, Mexico, Europe, Asia-Pacific and Latin America.

Receive News & Ratings for Differential Brands Group Inc. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Differential Brands Group Inc. and related companies with MarketBeat.com's FREE daily email newsletter.