Head-To-Head Review: Steven Madden (SHOO) & Columbia Sportswear (COLM)

Steven Madden (NASDAQ: SHOO) and Columbia Sportswear (NASDAQ:COLM) are both mid-cap consumer discretionary companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, earnings, risk, dividends, valuation, analyst recommendations and profitability.

Risk and Volatility

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Steven Madden has a beta of 0.45, suggesting that its stock price is 55% less volatile than the S&P 500. Comparatively, Columbia Sportswear has a beta of 0.91, suggesting that its stock price is 9% less volatile than the S&P 500.

Valuation and Earnings

This table compares Steven Madden and Columbia Sportswear’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Steven Madden $1.55 billion 1.62 $117.94 million $2.05 20.73
Columbia Sportswear $2.47 billion 2.16 $105.12 million $1.49 51.00

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

Analyst Ratings

This is a breakdown of recent recommendations for Steven Madden and Columbia Sportswear, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Steven Madden 0 3 8 0 2.73
Columbia Sportswear 0 7 7 0 2.50

Steven Madden currently has a consensus price target of $49.05, suggesting a potential upside of 15.40%. Columbia Sportswear has a consensus price target of $76.85, suggesting a potential upside of 1.13%. Given Steven Madden’s stronger consensus rating and higher possible upside, equities analysts clearly believe Steven Madden is more favorable than Columbia Sportswear.

Dividends

Steven Madden pays an annual dividend of $0.80 per share and has a dividend yield of 1.9%. Columbia Sportswear pays an annual dividend of $0.88 per share and has a dividend yield of 1.2%. Steven Madden pays out 39.0% of its earnings in the form of a dividend. Columbia Sportswear pays out 59.1% 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. Steven Madden is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

95.5% of Steven Madden shares are held by institutional investors. Comparatively, 38.9% of Columbia Sportswear shares are held by institutional investors. 2.1% of Steven Madden shares are held by insiders. Comparatively, 58.9% of Columbia Sportswear shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Steven Madden and Columbia Sportswear’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Steven Madden 7.63% 16.68% 12.66%
Columbia Sportswear 4.26% 12.65% 9.97%

Summary

Steven Madden beats Columbia Sportswear on 11 of the 16 factors compared between the two stocks.

Steven Madden Company Profile

Steven Madden, Ltd. and its subsidiaries design, source, market and sell name brand and private label footwear for women, men and children, and name brand and private label fashion handbags and accessories. The Company operates through five segments: Wholesale Footwear, Wholesale Accessories, Retail, First Cost and Licensing. Its products are sold through its retail stores and e-commerce Websites within the United States, Canada, Mexico and South Africa, as well as department stores, specialty stores, luxury retailers, value priced retailers, national chains, merchants and catalog retailers. It provides merchandising support to its department store customers, including in-store fixtures and signage, supervision of displays and merchandising of its various product lines. Its brands include Madden Girl, Steve Madden Men’s, Madden, Steven, Stevies and Steve Madden Kids, Betsey Johnson, Superga, FREEBIRD by Steve, Report, Mad Love, Dolce Vita, Brian Atwood and Blondo.

Columbia Sportswear Company Profile

Columbia Sportswear Company, together with its subsidiaries, designs, sources, markets, and distributes outdoor and active lifestyle apparel, footwear, accessories, and equipment in the United States, Latin America, the Asia Pacific, Europe, the Middle East, Africa, and Canada. The company provides apparel, accessories, and equipment that are used various outdoor activities, such as skiing, snowboarding, hiking, climbing, mountaineering, camping, hunting, fishing, trail running, water sports, yoga, golf, and adventure travel for men and women under the Columbia, Mountain Hardwear, SOREL, and prAna brands, as well as for youth under the Columbia brand name. It also offers footwear products, including hiking boots, trail running shoes, rugged cold weather boots, sandals, and casual shoes for men, women, and youth under the Columbia and SOREL brands. The company sells its products through wholesale distribution channels, direct-to-consumer channels, independent distributors, and licensees, as well as directly to consumers through its network of branded and outlet retail stores, and online. As of December 31, 2017, it operated 105 outlet retail stores and 24 branded retail stores in the United States; 119 concession-based, branded, outlet, and shop-in-shop locations in Japan; 162 concession-based, branded, outlet, and shop-in-shop locations in Korea; 24 outlet, shop-in-shop and concession-based locations, as well as 1 branded retail store in various locations in Western Europe; and 6 outlet retail stores in Canada. The company was founded in 1938 and is headquartered in Portland, Oregon.

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