Analyzing Esprit (OTCMKTS:ESPGY) and Tapestry (NYSE:TPR)

Tapestry (NYSE:TPR) and Esprit (OTCMKTS:ESPGY) are both retail/wholesale companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, earnings, institutional ownership, risk, valuation, profitability and analyst recommendations.

Volatility and Risk

Tapestry has a beta of 1.65, suggesting that its share price is 65% more volatile than the S&P 500. Comparatively, Esprit has a beta of -0.29, suggesting that its share price is 129% less volatile than the S&P 500.

Insider and Institutional Ownership

90.8% of Tapestry shares are owned by institutional investors. 1.3% of Tapestry shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Analyst Recommendations

This is a summary of current recommendations and price targets for Tapestry and Esprit, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tapestry	0	4	17	0	2.81
Esprit	0	0	0	0	0.00

Tapestry presently has a consensus price target of $122.00, indicating a potential downside of 5.93%. Given Tapestry’s stronger consensus rating and higher probable upside, research analysts plainly believe Tapestry is more favorable than Esprit.

Profitability

This table compares Tapestry and Esprit’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tapestry	3.77%	116.42%	17.30%
Esprit	N/A	N/A	N/A

Dividends

Tapestry pays an annual dividend of $1.60 per share and has a dividend yield of 1.2%. Esprit pays an annual dividend of $0.09 per share and has a dividend yield of 104.6%. Tapestry pays out 142.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Tapestry has raised its dividend for 3 consecutive years.

Earnings & Valuation

This table compares Tapestry and Esprit”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tapestry	$7.01 billion	3.79	$183.20 million	$1.12	115.79
Esprit	$5.38 million	0.24	-$157.30 million	N/A	N/A

Tapestry has higher revenue and earnings than Esprit.

Summary

Tapestry beats Esprit on 13 of the 15 factors compared between the two stocks.

About Tapestry

Tapestry, Inc. provides luxury accessories and branded lifestyle products in the United States, Japan, Greater China, and internationally. The company operates in three segments: Coach, Kate Spade, and Stuart Weitzman. It offers women’s handbags; and women’s accessories, such as small leather goods which includes mini and micro handbags, money pieces, wristlets, pouches, and cosmetic cases, as well as novelty accessories including address books, time management and travel accessories, sketchbooks, and portfolios; and belts, key rings, and charms. The company also provides men products, which includes bag collections, such as business cases, computer bags, messenger-style bags, backpacks, and totes; small leather goods including wallets, card cases, travel organizers, and belts; and footwear, watches, fragrances, sunglasses, novelty accessories, and ready-to-wear items. In addition, it offers other products including women’s footwear and fragrances; eyewear and sunglasses; and jewelry, such as bracelets, necklaces, rings, and earrings, watches, and other women’s seasonal lifestyle apparel collections, including outerwear, ready-to-wear and cold weather accessories, such as gloves, scarves, and hats. Further, the company provides kids items, housewares, and home accessories, such as fashion bedding and tableware, stationery, and gifts. It offers its products through e-commerce sites and concession shop-in-shops, wholesale, and third-party distributors under the Coach, Kate Spade, and Stuart Weitzman brand names. The company was formerly known as Coach, Inc. and changed its name to Tapestry, Inc. in October 2017. Tapestry, Inc. was founded in 1941 and is headquartered in New York, New York.

About Esprit

Esprit Holdings Limited, an investment holding company, engages in retail and wholesale distribution, and licensing of fashion and non-apparel products. It operates through Europe; Asia; E-shop; and Corporate Services, Sourcing, Licensing and Others segments. The company offers apparel and accessories under the ESPRIT brand name through retail stores and e-commerce platforms. It is also involved in the sourcing, purchasing, distributing, and sale of merchandise; provision of financial and treasury services, as well as logistic services comprising customs dealing and quality control; design and image directions; and conceptualization and development of global uniform image businesses. Esprit Holdings Limited was founded in 1968 and is headquartered in North Point, Hong Kong.