Stanley Black & Decker (NYSE:SWK) versus La-Z-Boy (NYSE:LZB) Financial Comparison

Stanley Black & Decker (NYSE:SWK) and La-Z-Boy (NYSE:LZB) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their analyst recommendations, earnings, risk, dividends, profitability, institutional ownership and valuation.

Risk & Volatility

Stanley Black & Decker has a beta of 1.17, suggesting that its stock price is 17% more volatile than the S&P 500. Comparatively, La-Z-Boy has a beta of 1.23, suggesting that its stock price is 23% more volatile than the S&P 500.

Insider & Institutional Ownership

87.8% of Stanley Black & Decker shares are held by institutional investors. Comparatively, 99.6% of La-Z-Boy shares are held by institutional investors. 0.7% of Stanley Black & Decker shares are held by insiders. Comparatively, 3.1% of La-Z-Boy shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Profitability

This table compares Stanley Black & Decker and La-Z-Boy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Stanley Black & Decker	4.07%	8.78%	3.73%
La-Z-Boy	3.86%	11.79%	6.12%

Dividends

Stanley Black & Decker pays an annual dividend of $3.36 per share and has a dividend yield of 3.8%. La-Z-Boy pays an annual dividend of $0.97 per share and has a dividend yield of 3.3%. Stanley Black & Decker pays out 82.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. La-Z-Boy pays out 49.2% of its earnings in the form of a dividend. Stanley Black & Decker has increased its dividend for 58 consecutive years and La-Z-Boy has increased its dividend for 4 consecutive years. Stanley Black & Decker is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of recent ratings and target prices for Stanley Black & Decker and La-Z-Boy, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Stanley Black & Decker	1	6	3	0	2.20
La-Z-Boy	1	1	3	0	2.40

Stanley Black & Decker currently has a consensus target price of $92.88, indicating a potential upside of 4.64%. La-Z-Boy has a consensus target price of $39.50, indicating a potential upside of 32.59%. Given La-Z-Boy’s stronger consensus rating and higher possible upside, analysts clearly believe La-Z-Boy is more favorable than Stanley Black & Decker.

Earnings & Valuation

This table compares Stanley Black & Decker and La-Z-Boy”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Stanley Black & Decker	$15.13 billion	0.89	$401.90 million	$4.10	21.65
La-Z-Boy	$2.13 billion	0.56	$101.99 million	$1.97	15.12

Stanley Black & Decker has higher revenue and earnings than La-Z-Boy. La-Z-Boy is trading at a lower price-to-earnings ratio than Stanley Black & Decker, indicating that it is currently the more affordable of the two stocks.

About Stanley Black & Decker

Stanley Black & Decker, Inc. engages in the provision of power and hand tools, and related accessories, products, services and equipment for oil and gas, infrastructure applications, commercial electronic security and monitoring systems, healthcare solutions, and mechanical access solutions. It operates through the Tools and Outdoor and Industrial segments. The Tools and Outdoor segment refers to power tools, hand tools, accessories and storage, and outdoor power equipment product lines. The Industrial segment includes the engineered fastening and infrastructure businesses. The company was founded by Frederick T. Stanley in 1843 and is headquartered in New Britain, CT.

About La-Z-Boy

La-Z-Boy Incorporated manufactures, markets, imports, exports, distributes, and retails upholstery furniture products, accessories, and casegoods furniture products in the United States, Canada, and internationally. It operates through Wholesale, Retail, Corporate and Other segments. The Wholesale segment manufactures, and imports upholstered furniture, such as recliners and motion furniture, sofas, loveseats, chairs, sectionals, modulars, ottomans, and sleeper sofas; and imports, distributes, and retails casegoods (wood) furniture, including occasional pieces, bedroom sets, dining room sets, entertainment centers, and occasional pieces. This segment sells its products directly to La-Z-Boy Furniture Galleries stores, operators of La-Z-Boy Comfort Studio locations, England Custom Comfort Center locations, dealers, and other independent retailers. The Retail segment sells upholstered furniture, casegoods, and other accessories to the end consumer through its retail network. The company also produces reclining chairs; and manufactures and distributes residential furniture. Its Corporate and Other segment sells the products through its website. The company was formerly known as La-Z-Boy Chair Company and changed its name to La-Z-Boy Incorporated in 1996. La-Z-Boy Incorporated was founded in 1927 and is headquartered in Monroe, Michigan.