Contrasting Immersion (NASDAQ:IMMR) and Caleres (NYSE:CAL)

Caleres (NYSE:CAL) and Immersion (NASDAQ:IMMR) are both small-cap consumer discretionary companies, but which is the superior stock? We will compare the two businesses based on the strength of their risk, dividends, institutional ownership, valuation, analyst recommendations, profitability and earnings.

Earnings and Valuation

This table compares Caleres and Immersion”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Caleres	$2.76 billion	0.16	-$6.69 million	$1.50	8.33
Immersion	$1.73 billion	0.14	$4.52 million	$0.34	21.44

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

Insider & Institutional Ownership

98.4% of Caleres shares are owned by institutional investors. Comparatively, 60.6% of Immersion shares are owned by institutional investors. 3.1% of Caleres shares are owned by insiders. Comparatively, 10.6% of Immersion shares are owned 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.

Profitability

This table compares Caleres and Immersion’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Caleres	1.85%	7.84%	2.42%
Immersion	0.60%	1.83%	0.82%

Risk & Volatility

Caleres has a beta of 0.75, suggesting that its share price is 25% less volatile than the S&P 500. Comparatively, Immersion has a beta of 1.02, suggesting that its share price is 2% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Caleres and Immersion, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Caleres	0	3	0	0	2.00
Immersion	0	2	1	0	2.33

Immersion has a consensus target price of $13.50, suggesting a potential upside of 85.19%. Given Immersion’s stronger consensus rating and higher possible upside, analysts plainly believe Immersion is more favorable than Caleres.

Dividends

Caleres pays an annual dividend of $0.28 per share and has a dividend yield of 2.2%. Immersion pays an annual dividend of $0.30 per share and has a dividend yield of 4.1%. Caleres pays out 18.7% of its earnings in the form of a dividend. Immersion pays out 88.2% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

About Caleres

Caleres, Inc. engages in the retail and wholesale of footwear business in the United States, Canada, East Asia, and internationally. It operates through Famous Footwear and Brand Portfolio segments. The company offers licensed, branded, and private-label athletic, casual, and dress footwear products. The company provides brand name athletic, casual, and dress shoes, including Nike, Skechers, adidas, Vans, Crocs, Converse, Puma, Birkenstock, New Balance, Under Armour, Dr. Martens, Asics, Timberland, Bearpaw, Skechers, HeyDude, Franco Sarto, Rykä, Vince, Bzees, Veronica Beard, and Zodiac brands, as well as company-owned and licensed brands, such as LifeStride, Dr. Scholl’s Shoes, Blowfish Malibu, and Naturalizer. The company also operates naturalizer.com, naturalizer.ca, vionicshoes.com, samedelman.com, samedelman.co.uk, allenedmonds.com, allenedmonds.ca, drschollsshoes.com, lifestride.com, francosarto.com, ryka.com, bzees.com, and zodiacshoes.com, as well as Vince.com, blowfishshoes.com, and veronicabeard.com websites. In addition, it designs, sources, manufactures, and markets footwear to retail stores, such as online retailers, national chains, department stores, mass merchandisers, and independent retailers. Further, the company wholesales men’s footwear, apparel, leather goods, and accessories under the Allen Edmonds brand; footwear for women under LifeStride brand; Italian footwear Franco Sarto brand; athletic footwear for women under the Rykä brand; women’s shoe collection under the Vince brand; women’s footwear under the Bzees brand; and women’s footwear collection under Veronica Beard brand. The company was formerly known as Brown Shoe Company, Inc. and changed its name to Caleres, Inc. in May 2015. Caleres, Inc. was founded in 1878 and is headquartered in Saint Louis, Missouri.

About Immersion

Immersion Corporation, together with its subsidiaries, engages in the creation, design, development, and licensing of haptic technologies that allow people to use their sense of touch to engage with and experience various digital products in North America, Europe, and Asia. The company provides technology, patent, and combined licenses. It serves markets, including mobility, gaming, automotive, virtual and augmented reality, and wearables, as well as residential, commercial, and industrial Internet of Things. The company was incorporated in 1993 and is headquartered in Aventura, Florida.