Tailored Brands (NYSE: TLRD) and Zumiez (NASDAQ:ZUMZ) are both small-cap cyclical consumer goods & services companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, earnings, valuation, institutional ownership, analyst recommendations, dividends and profitability.

Profitability

This table compares Tailored Brands and Zumiez’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Tailored Brands 6.87% N/A 11.18%
Zumiez 2.78% 7.83% 5.31%

Analyst Recommendations

This is a summary of current ratings and recommmendations for Tailored Brands and Zumiez, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tailored Brands 0 4 4 0 2.50
Zumiez 0 5 1 0 2.17

Tailored Brands currently has a consensus target price of $17.33, indicating a potential upside of 1.84%. Zumiez has a consensus target price of $19.43, indicating a potential downside of 2.61%. Given Tailored Brands’ stronger consensus rating and higher possible upside, equities analysts clearly believe Tailored Brands is more favorable than Zumiez.

Dividends

Tailored Brands pays an annual dividend of $0.72 per share and has a dividend yield of 4.2%. Zumiez does not pay a dividend. Tailored Brands pays out 60.5% of its earnings in the form of a dividend.

Volatility & Risk

Tailored Brands has a beta of 1.87, indicating that its share price is 87% more volatile than the S&P 500. Comparatively, Zumiez has a beta of 1.33, indicating that its share price is 33% more volatile than the S&P 500.

Institutional and Insider Ownership

75.0% of Zumiez shares are held by institutional investors. 2.0% of Tailored Brands shares are held by company insiders. Comparatively, 27.5% of Zumiez shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Tailored Brands and Zumiez’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Tailored Brands $3.38 billion 0.25 $24.95 million $1.19 14.30
Zumiez $836.27 million 0.60 $25.90 million $0.97 20.57

Zumiez has lower revenue, but higher earnings than Tailored Brands. Tailored Brands is trading at a lower price-to-earnings ratio than Zumiez, indicating that it is currently the more affordable of the two stocks.

Summary

Tailored Brands beats Zumiez on 9 of the 16 factors compared between the two stocks.

About Tailored Brands

Tailored Brands, Inc. is a holding company of The Men’s Wearhouse, Inc. The Company is a specialty apparel retailer offering suits, suit separates, sport coats, slacks, business casual, sportswear, outerwear, dress shirts, shoes and accessories for men and tuxedo and suit rental product. It operates through two segments: Retail and Corporate Apparel. The Retail segment includes four retail merchandising brands: Men’s Wearhouse/Men’s Wearhouse and Tux, Jos. A. Bank, Moores, and K&G. Specialty apparel merchandise offered by its retail merchandising concepts include suits, suit separates, sport coats, business casual, sportswear, outerwear, dress shirts, shoes and accessories for men. Women’s career apparel, sportswear and accessories, such as shoes and children’s apparel are offered at its K&G stores. The Corporate Apparel segment includes corporate apparel and uniform operations conducted by Twin Hill in the United States and Dimensions, Alexandra and Yaffy in the United Kingdom.

About Zumiez

Zumiez Inc., including its subsidiaries, is a specialty retailer of apparel, footwear, accessories and hardgoods for young men and women through the fashion, music, art and culture of action sports, streetwear and other lifestyles. The Company operates under the names Zumiez, Blue Tomato and Fast Times. Additionally, it operates e-commerce Websites at www.zumiez.com, www.blue-tomato.com and www.fasttimes.com.au. It offers various categories of shoes, such as skate shoes, casual shoes, high tops, sandals, slip ons, runners, boots and shoe accessories, such as socks. It also offers flannels, baseball tees, hoodies, baseball hats, windbreakers, shirts, jackets, jerseys, sweaters and tanks, among others. For women, it offers t-shirts, tank tops, hoodies and sweatshirts, cardigans, jackets, skirts, jeans, joggers, leggings and dresses, among others. It provides various accessories, including watches, sunglasses, bracelets, earrings, rings, beanies, hats, belts, wallets and phone accessories

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