Head to Head Review: Luk Fook (OTCMKTS:LKFLF) and Sally Beauty (NYSE:SBH)

Luk Fook (OTCMKTS:LKFLF) and Sally Beauty (NYSE:SBH) are both small-cap consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, valuation, analyst recommendations, risk, earnings, dividends and institutional ownership.

Risk and Volatility

Luk Fook has a beta of 0.01, suggesting that its stock price is 99% less volatile than the S&P 500. Comparatively, Sally Beauty has a beta of 1.03, suggesting that its stock price is 3% more volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Luk Fook and Sally Beauty, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Luk Fook	0	0	0	0	0.00
Sally Beauty	1	3	3	0	2.29

Sally Beauty has a consensus target price of $17.40, suggesting a potential upside of 4.69%. Given Sally Beauty’s stronger consensus rating and higher probable upside, analysts plainly believe Sally Beauty is more favorable than Luk Fook.

Profitability

This table compares Luk Fook and Sally Beauty’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Luk Fook	N/A	N/A	N/A
Sally Beauty	5.16%	24.36%	7.07%

Valuation & Earnings

This table compares Luk Fook and Sally Beauty”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Luk Fook	$2.20 billion	0.80	$262.07 million	N/A	N/A
Sally Beauty	$3.70 billion	0.42	$195.88 million	$1.92	8.66

Luk Fook has higher earnings, but lower revenue than Sally Beauty.

Summary

Sally Beauty beats Luk Fook on 8 of the 10 factors compared between the two stocks.

About Luk Fook

Luk Fook Holdings (International) Limited, an investment holding company, engages in sourcing, designing, wholesaling, trademark licensing, and retailing various gold and platinum jewelry, and gem-set jewelry products. It offers ring and pair rings, necklaces, pendants, earrings, bangles and bracelets, charms, figurines, accessories, and other products of various materials comprising diamond, gold, platinum, jadeite, gemstone, pearl, and silver materials. The company also provides authentication of gemstones; gold bullion trading services; and software development and services related to internet. In addition, it wholesales polished diamonds; offers trademark licensing, brand building, promotion, and quality examination services, as well as diamond subcontracting handling and diamonds custom export services; and engages in electronic retailing of gold and jewelry products. The company was founded in 1991 and is headquartered in Sha Tin, Hong Kong.

About Sally Beauty

Sally Beauty Holdings, Inc. operates as a specialty retailer and distributor of professional beauty supplies. The company operates through two segments, Sally Beauty Supply and Beauty Systems Group. The Sally Beauty Supply segment offers beauty products, including hair color and care products, skin and nail care products, styling tools, and other beauty products for retail customers, salons, and salon professionals. This segment also provides products under Wella and L'Oreal brands. The Beauty Systems Group segment offers professional beauty products, such as hair color and care products, skin and nail care products, styling tools, and other beauty items directly to salons and salon professionals through its professional-only stores, e-commerce platforms, and sales force, as well as through franchised stores under the Armstrong McCall store name. This segment also sells products under Paul Mitchell and Wella brands. It operates stores and franchised units in the United States, Puerto Rico, Canada, Mexico, Chile, Peru, the United Kingdom, Ireland, Belgium, France, the Netherlands, Spain, and Germany. The company distributes its products through full-service/exclusive distributors and open-line distributors. Sally Beauty Holdings, Inc. was founded in 1964 and is headquartered in Denton, Texas.