Rocky Brands (NASDAQ: RCKY) and Caleres (NYSE:CAL) are both small-cap consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their profitability, valuation, earnings, dividends, risk, analyst recommendations and institutional ownership.
Insider & Institutional Ownership
58.8% of Rocky Brands shares are owned by institutional investors. Comparatively, 89.7% of Caleres shares are owned by institutional investors. 8.5% of Rocky Brands shares are owned by company insiders. Comparatively, 6.2% of Caleres shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
This is a breakdown of recent recommendations and price targets for Rocky Brands and Caleres, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Rocky Brands | 0 | 2 | 0 | 0 | 2.00 |
| Caleres | 0 | 2 | 4 | 0 | 2.67 |
Rocky Brands presently has a consensus target price of $16.00, suggesting a potential downside of 23.26%. Caleres has a consensus target price of $34.00, suggesting a potential upside of 5.07%. Given Caleres’ stronger consensus rating and higher possible upside, analysts clearly believe Caleres is more favorable than Rocky Brands.
Volatility and Risk
Rocky Brands has a beta of 0.43, suggesting that its stock price is 57% less volatile than the S&P 500. Comparatively, Caleres has a beta of 1.07, suggesting that its stock price is 7% more volatile than the S&P 500.
Dividends
Rocky Brands pays an annual dividend of $0.44 per share and has a dividend yield of 2.1%. Caleres pays an annual dividend of $0.28 per share and has a dividend yield of 0.9%. Rocky Brands pays out 34.1% of its earnings in the form of a dividend. Caleres pays out 13.8% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.
Profitability
This table compares Rocky Brands and Caleres’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Rocky Brands | 3.79% | 6.24% | 4.81% |
| Caleres | 3.13% | 14.01% | 6.30% |
Earnings and Valuation
This table compares Rocky Brands and Caleres’ revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Rocky Brands | $253.20 million | 0.61 | $9.58 million | $1.29 | 16.16 |
| Caleres | $2.79 billion | 0.50 | $87.20 million | $2.03 | 15.94 |
Caleres has higher revenue and earnings than Rocky Brands. Caleres is trading at a lower price-to-earnings ratio than Rocky Brands, indicating that it is currently the more affordable of the two stocks.
Summary
Caleres beats Rocky Brands on 11 of the 16 factors compared between the two stocks.
About Rocky Brands
Rocky Brands, Inc. is a designer, manufacturer and marketer of footwear and apparel marketed under a portfolio of brand names, including Rocky, Georgia Boot, Durango, Lehigh and the licensed brand Michelin. The Company operates its business through three segments: wholesale, retail and military. In its wholesale segment, the Company distributes its products through a range of distribution channels representing over 10,000 retail store locations in the United States and Canada, as well as in other international markets. Its wholesale channels vary by product line and include sporting goods stores, outdoor retailers, independent shoe retailers, hardware stores, catalogs, mass merchants and uniform stores. In its retail segment, the Company sells its products directly to consumers through its consumer and business direct Websites and its Rocky outlet store. In its military segment, the Company sells footwear under the Rocky label to the United States military.
About Caleres
Caleres, Inc. is a global footwear retailer and wholesaler. The Company is engaged in the operation of retail shoe stores and e-commerce Websites, as well as the design, sourcing and marketing of footwear for women and men. The Company operates through two segments: Famous Footwear and Brand Portfolio. The Company’s Famous Footwear segment includes its Famous Footwear stores and Famous.com. Its Famous Footwear stores offer a range of athletic, casual and dress shoes for the entire family. The Company’s Brand Portfolio segment offers retailers and consumers a portfolio of brands from its Healthy Living and Contemporary Fashion platforms by designing, sourcing and marketing branded footwear for women and men at a range of price points. Its Brand Portfolio segment sells footwear on a wholesale basis to retailers. The Brand Portfolio segment also sells footwear through its branded retail stores and e-commerce businesses.
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