Barnes & Noble (NYSE: BKS) and Big 5 Sporting Goods (NASDAQ:BGFV) are both small-cap retail/wholesale companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, analyst recommendations, profitability, valuation, dividends, institutional ownership and earnings.
Barnes & Noble pays an annual dividend of $0.60 per share and has a dividend yield of 10.7%. Big 5 Sporting Goods pays an annual dividend of $0.60 per share and has a dividend yield of 6.9%. 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 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%|
Institutional and Insider Ownership
67.4% of Barnes & Noble shares are held by institutional investors. Comparatively, 92.0% of Big 5 Sporting Goods shares are held by institutional investors. 19.0% of Barnes & Noble shares are held by insiders. Comparatively, 7.9% of Big 5 Sporting Goods shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock is poised for long-term growth.
Volatility & Risk
Barnes & Noble has a beta of 2.14, suggesting that its share price is 114% more volatile than the S&P 500. Comparatively, Big 5 Sporting Goods has a beta of -0.62, suggesting that its share price is 162% less volatile than the S&P 500.
Valuation & Earnings
This table compares Barnes & Noble and Big 5 Sporting Goods’ top-line 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||13.02|
|Big 5 Sporting Goods||$1.01 billion||0.18||$1.10 million||$0.57||15.26|
Barnes & Noble has higher revenue and earnings than Big 5 Sporting Goods. Barnes & Noble is trading at a lower price-to-earnings ratio than Big 5 Sporting Goods, indicating that it is currently the more affordable of the two stocks.
This is a summary of current recommendations 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 target price of $9.00, suggesting a potential upside of 3.45%. Given Big 5 Sporting Goods’ higher possible upside, analysts clearly believe Big 5 Sporting Goods is more favorable than Barnes & Noble.
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. operates as a content and commerce company in the United States. Barnes & Noble, Inc. operates as a retailer of books, content, digital media, and educational products. It sells trade books, including hardcover and paperback titles; mass market paperbacks, such as mystery, romance, science fiction, and other fiction; and children's books, eBooks and other digital content, NOOK and related accessories, bargain books, magazines, gifts, café products and services, educational toys and games, and music and movies. The company also offers a suite of new, used, and digital textbooks, as well as textbooks rentals. As of June 22, 2017, it operated through 633 Barnes & Noble bookstores in 50 states, as well as BN.com, nook.com, and barnesandnoble.com Websites. The company was founded in 1986 and is based in New York, New York.
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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