Tapestry (TPR) versus Vera Bradley (VRA) Critical Contrast

Tapestry (NYSE: TPR) and Vera Bradley (NASDAQ:VRA) are both retail/wholesale companies, but which is the superior business? We will compare the two businesses based on the strength of their earnings, valuation, analyst recommendations, profitability, dividends, institutional ownership and risk.

Valuation & Earnings

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This table compares Tapestry and Vera Bradley’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Tapestry $4.49 billion 3.33 $591.00 million $2.15 24.40
Vera Bradley $454.65 million 0.85 $7.01 million $0.60 18.13

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

Institutional and Insider Ownership

89.4% of Tapestry shares are owned by institutional investors. Comparatively, 62.5% of Vera Bradley shares are owned by institutional investors. 1.0% of Tapestry shares are owned by insiders. Comparatively, 39.6% of Vera Bradley shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Volatility and Risk

Tapestry has a beta of 0.42, meaning that its stock price is 58% less volatile than the S&P 500. Comparatively, Vera Bradley has a beta of 0.66, meaning that its stock price is 34% less volatile than the S&P 500.

Dividends

Tapestry pays an annual dividend of $1.35 per share and has a dividend yield of 2.6%. Vera Bradley does not pay a dividend. Tapestry pays out 62.8% of its earnings in the form of a dividend.

Analyst Ratings

This is a summary of current ratings for Tapestry and Vera Bradley, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Tapestry 1 6 20 1 2.75
Vera Bradley 0 4 2 0 2.33

Tapestry presently has a consensus price target of $52.31, indicating a potential downside of 0.31%. Vera Bradley has a consensus price target of $11.00, indicating a potential upside of 1.10%. Given Vera Bradley’s higher probable upside, analysts plainly believe Vera Bradley is more favorable than Tapestry.

Profitability

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

Net Margins Return on Equity Return on Assets
Tapestry 6.14% 23.68% 10.98%
Vera Bradley 1.54% 7.66% 6.05%

Summary

Tapestry beats Vera Bradley on 13 of the 17 factors compared between the two stocks.

Tapestry Company Profile

Tapestry, Inc. provides luxury accessories and lifestyle brands. It offers handbags, wallets, money pieces, wristlets and cosmetic cases, key rings, and charms, as well as address books, time management accessories, sketchbooks, and portfolios for women; and business cases, computer bags, messenger-style bags, backpacks, totes, wallets, card cases, belts, sunglasses, watches, novelty accessories, and ready-to-wear for men. The company also provides footwear; seasonal lifestyle apparel collections, including outerwear and ready-to-wear, gloves, scarves, and hats; jewelry, such as bracelets, necklaces, rings, and earrings made with sterling silver, leather, and non-precious metals; sunglasses; watches; and fragrances comprising perfume sprays, toilette sprays, purse sprays, and body creams for women. In addition, it offers children's wear, tech and home decor products; and weekend and travel accessories, travel bags, and other lifestyle products. Further, the company licenses rights to market and distribute its eyewear, watches, and fragrances under the Coach brand name. It markets its products to consumers through a network of Coach-operated stores, including Internet in North America; and Coach-operated stores and concession shop-in-shops in Japan, Mainland China, Hong Kong, Macau, Singapore, Taiwan, Malaysia, South Korea, the United Kingdom, France, Ireland, Spain, Portugal, Germany, Italy, Austria, Belgium, the Netherlands, and Switzerland, as well as to wholesale customers and distributors in approximately 55 countries. The company sells its Stuart Weitzman products through department stores; independent third party distributors; and stores, including the Internet. It operates approximately 1,300 stores under the Coach, kate spade new york, and Stuart Weitzman brands. The company was formerly known as Coach, Inc. and changed its name to Tapestry, Inc. in October 2017. Tapestry, Inc. was founded in 1941 and is headquartered in New York, New York.

Vera Bradley Company Profile

Vera Bradley, Inc. (Vera Bradley) is a designer of women’s handbags, accessories, luggage and travel items, eyewear, and stationery and gifts. The Company’s segments include Direct and Indirect. The Company offers various products, including bags, travel, home and accessories. Its accessories include fashion accessories, such as wallets, eyeglass cases, jewelry, and scarves and various technology accessories. The Direct business consists of sales of Vera Bradley products through factory outlet stores in the United States, verabradley.com, direct-to-consumer eBay sales and its annual outlet sale in Fort Wayne, Indiana. As of January 28, 2017, the Indirect business consisted of sales of Vera Bradley products to approximately 2,600 specialty retail locations, substantially all of which were located in the United States, as well as department stores, national accounts, third party e-commerce sites, the Company’s wholesale customer in Japan, and third-party inventory liquidators.

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