Head to Head Review: Kontoor Brands (NYSE:KTB) versus Vera Bradley (NASDAQ:VRA)

Kontoor Brands (NYSE:KTB) and Vera Bradley (NASDAQ:VRA) are both consumer discretionary companies, but which is the superior stock? We will contrast the two companies based on the strength of their institutional ownership, profitability, analyst recommendations, risk, dividends, earnings and valuation.

Analyst Ratings

This is a summary of current ratings and target prices for Kontoor Brands and Vera Bradley, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kontoor Brands	1	3	7	1	2.67
Vera Bradley	1	0	0	1	2.50

Kontoor Brands currently has a consensus price target of $95.33, indicating a potential upside of 22.72%. Given Kontoor Brands’ stronger consensus rating and higher probable upside, equities research analysts clearly believe Kontoor Brands is more favorable than Vera Bradley.

Volatility and Risk

Kontoor Brands has a beta of 0.85, indicating that its stock price is 15% less volatile than the S&P 500. Comparatively, Vera Bradley has a beta of 1.45, indicating that its stock price is 45% more volatile than the S&P 500.

Profitability

This table compares Kontoor Brands and Vera Bradley’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kontoor Brands	6.51%	59.17%	13.08%
Vera Bradley	-3.66%	-3.80%	-2.11%

Earnings and Valuation

This table compares Kontoor Brands and Vera Bradley”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kontoor Brands	$3.15 billion	1.35	$227.45 million	$3.59	21.64
Vera Bradley	$274.49 million	0.79	-$47.84 million	($0.37)	-20.38

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

Insider & Institutional Ownership

93.1% of Kontoor Brands shares are held by institutional investors. Comparatively, 59.9% of Vera Bradley shares are held by institutional investors. 1.8% of Kontoor Brands shares are held by company insiders. Comparatively, 14.3% of Vera Bradley shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Kontoor Brands beats Vera Bradley on 12 of the 14 factors compared between the two stocks.

About Kontoor Brands

Kontoor Brands is an apparel company focused on denim and casual clothing. Its portfolio includes Wrangler and Lee, brands known for jeans and other everyday apparel, as well as Rock & Republic. The company sells products such as jeans, shirts, jackets, shorts and related apparel through wholesale partners and direct-to-consumer channels, including its own retail stores and e-commerce operations. Kontoor Brands serves customers in markets around the world. It became an independent public company in 2019 after being spun off from VF Corporation.

About Vera Bradley

Vera Bradley, Inc. (NASDAQ: VRA) is a lifestyle company that designs, manufactures and sells handbags, travel products, accessories, gifts and related merchandise. Its products are known for colorful patterns and are offered through company-operated stores, its websites and third-party retail partners. The company’s portfolio includes the Vera Bradley brand, which offers handbags, backpacks, luggage, wallets, apparel, home goods and other lifestyle products. Vera Bradley also owns Pura Vida, a brand centered on bracelets, jewelry and accessories, along with apparel and other products.