Critical Review: Build-A-Bear Workshop (NYSE:BBW) and Burberry Group (OTCMKTS:BURBY)

Burberry Group (OTCMKTS:BURBY) and Build-A-Bear Workshop (NYSE:BBW) are both consumer discretionary companies, but which is the superior investment? We will contrast the two businesses based on the strength of their dividends, risk, earnings, institutional ownership, profitability, valuation and analyst recommendations.

Institutional & Insider Ownership

10.3% of Burberry Group shares are owned by institutional investors. Comparatively, 79.3% of Build-A-Bear Workshop shares are owned by institutional investors. 4.0% of Build-A-Bear Workshop shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Burberry Group and Build-A-Bear Workshop’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Burberry Group	N/A	N/A	N/A
Build-A-Bear Workshop	10.48%	32.15%	14.83%

Earnings & Valuation

This table compares Burberry Group and Build-A-Bear Workshop”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Burberry Group	$3.24 billion	1.69	$28.15 million	N/A	N/A
Build-A-Bear Workshop	$529.83 million	0.85	$52.20 million	$4.27	8.43

Build-A-Bear Workshop has lower revenue, but higher earnings than Burberry Group.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Burberry Group and Build-A-Bear Workshop, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Burberry Group	0	1	0	1	3.00
Build-A-Bear Workshop	0	2	3	0	2.60

Build-A-Bear Workshop has a consensus price target of $70.00, indicating a potential upside of 94.54%. Given Build-A-Bear Workshop’s higher probable upside, analysts clearly believe Build-A-Bear Workshop is more favorable than Burberry Group.

Volatility & Risk

Burberry Group has a beta of 1.09, meaning that its share price is 9% more volatile than the S&P 500. Comparatively, Build-A-Bear Workshop has a beta of 1.1, meaning that its share price is 10% more volatile than the S&P 500.

Summary

Build-A-Bear Workshop beats Burberry Group on 9 of the 13 factors compared between the two stocks.

About Burberry Group

Burberry Group plc, together with its subsidiaries, manufactures, retails, and wholesales luxury goods under the Burberry brand. The company operates in two segments, Retail/Wholesale and Licensing. It provides womenswear, menswear, childrenswear, beauty, eyewear, shoes, and accessories, as well as leather goods, such as bags. The company also licenses third parties to manufacture and distribute products using the Burberry trademarks. It sells its products through Burberry mainline stores, concessions, outlets, digital commerce, Burberry franchisees, department stores, and multi-brand specialty accounts, as well as through Burberry.com website. It operates in the Asia Pacific, Europe, the Middle East, India, Africa, and the Americas. The company was founded in 1856 and is headquartered in London, the United Kingdom.

About Build-A-Bear Workshop

Build-A-Bear Workshop, Inc. operates as a multi-channel retailer of plush animals and related products in the United States, Canada, the United Kingdom, Ireland, and internationally. The company operates through three segments: Direct-to-Consumer, Commercial, and International Franchising. Its merchandise comprises various styles of plush products to be stuffed, pre-stuffed plush products, and sounds and scents that can be added to the stuffed animals, as well as range of clothing, shoes and accessories, and other toy and novelty items, including family sleepwear. The company operates its stores under the Build-A-Bear Workshop brand name; and sells its products through its e-commerce sites and third-party marketplace sites. Build-A-Bear Workshop, Inc. was founded in 1997 and is headquartered in Saint Louis, Missouri.