Barnes & Noble (NYSE: BKS) and Big 5 Sporting Goods (NASDAQ:BGFV) are both small-cap retail/wholesale companies, but which is the better investment? We will compare the two companies based on the strength of their institutional ownership, valuation, risk, dividends, analyst recommendations, earnings and profitability.
Valuation and Earnings
This table compares Barnes & Noble and Big 5 Sporting Goods’ revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|Barnes & Noble||$3.89 billion||0.10||$22.02 million||$0.43||12.21|
|Big 5 Sporting Goods||$1.01 billion||0.15||$1.10 million||$0.57||12.81|
This table compares Barnes & Noble and Big 5 Sporting Goods’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Barnes & Noble||-3.19%||6.72%||1.79%|
|Big 5 Sporting Goods||0.11%||5.97%||2.70%|
Volatility and Risk
Barnes & Noble has a beta of 2.15, suggesting that its stock price is 115% more volatile than the S&P 500. Comparatively, Big 5 Sporting Goods has a beta of -0.61, suggesting that its stock price is 161% less volatile than the S&P 500.
Barnes & Noble pays an annual dividend of $0.60 per share and has a dividend yield of 11.4%. Big 5 Sporting Goods pays an annual dividend of $0.60 per share and has a dividend yield of 8.2%. Barnes & Noble pays out 139.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Big 5 Sporting Goods pays out 105.3% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.
This is a breakdown of current ratings and price targets for Barnes & Noble and Big 5 Sporting Goods, as reported by MarketBeat.com.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Barnes & Noble||0||1||0||0||2.00|
|Big 5 Sporting Goods||0||2||0||0||2.00|
Big 5 Sporting Goods has a consensus price target of $9.00, suggesting a potential upside of 23.29%. Given Big 5 Sporting Goods’ higher possible upside, analysts plainly believe Big 5 Sporting Goods is more favorable than Barnes & Noble.
Insider & Institutional Ownership
67.5% of Barnes & Noble shares are owned by institutional investors. Comparatively, 92.4% of Big 5 Sporting Goods shares are owned by institutional investors. 19.0% of Barnes & Noble shares are owned by insiders. Comparatively, 7.9% of Big 5 Sporting Goods 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.
Big 5 Sporting Goods beats Barnes & Noble on 8 of the 14 factors compared between the two stocks.
Barnes & Noble Company Profile
Barnes & Noble, Inc. is a bookseller. The Company is a content and commerce company, which provides access to trade books and other content across its multi-channel distribution platform. It operates in two segments: Barnes & Noble Retail (B&N Retail) and NOOK. The Company is engaged in the sale of trade books (generally hardcover and paperback consumer titles), mass market paperbacks (such as mystery, romance, science fiction and other fiction), children’s books, eBooks and other digital content, textbooks and course-related materials, NOOK and related accessories, bargain books, magazines, gifts, cafe products and services, educational toys and games, music and movies direct to customers through its bookstores or on www.barnesandnoble.com. The Company also offers a textbook rental option to its customers through barnesandnoble.com. The Company offers its customers a suite of textbook options-new, used, digital and rental.
Big 5 Sporting Goods Company Profile
Big 5 Sporting Goods Corporation operates as a sporting goods retailer in the western United States. The company offers athletic shoes, apparel, and accessories, as well as a selection of outdoor and athletic equipment for team sports, fitness, camping, hunting, fishing, tennis, golf, winter and summer recreation, and roller sports. It also provides private label items, such as shoes, apparel, camping equipment, fishing supplies, and snow sport equipment. The company sells private label merchandise under its own trademarks comprising Golden Bear, Harsh, Pacifica, and Rugged Exposure; and licensed trademarks, including Beach Feet, Bearpaw, Body Glove, Morrow, and The Realm. As of December 31, 2017, it operated 435 stores and an e-commerce platform under the Big 5 Sporting Goods name. Big 5 Sporting Goods Corporation was founded in 1955 and is headquartered in El Segundo, California.
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