Critical Survey: Tilly’s (NYSE:TLYS) versus O’Reilly Automotive (NASDAQ:ORLY)

Tilly’s (NYSE:TLYS) and O’Reilly Automotive (NASDAQ:ORLY) are both consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their risk, analyst recommendations, valuation, institutional ownership, earnings, profitability and dividends.

Insider & Institutional Ownership

76.4% of Tilly’s shares are owned by institutional investors. Comparatively, 85.0% of O’Reilly Automotive shares are owned by institutional investors. 26.4% of Tilly’s shares are owned by company insiders. Comparatively, 0.8% of O’Reilly Automotive shares are owned by company 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.

Valuation & Earnings

This table compares Tilly’s and O’Reilly Automotive”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Tilly’s	$553.59 million	0.25	-$17.45 million	$0.06	74.30
O’Reilly Automotive	$17.78 billion	3.93	$2.54 billion	$3.14	27.53

O’Reilly Automotive has higher revenue and earnings than Tilly’s. O’Reilly Automotive is trading at a lower price-to-earnings ratio than Tilly’s, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Tilly’s and O’Reilly Automotive’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Tilly’s	0.34%	2.37%	0.61%
O’Reilly Automotive	14.27%	-232.45%	15.79%

Analyst Recommendations

This is a summary of current recommendations and price targets for Tilly’s and O’Reilly Automotive, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Tilly’s	0	3	0	0	2.00
O’Reilly Automotive	0	4	16	0	2.80

Tilly’s presently has a consensus target price of $5.50, indicating a potential upside of 23.37%. O’Reilly Automotive has a consensus target price of $107.26, indicating a potential upside of 24.08%. Given O’Reilly Automotive’s stronger consensus rating and higher probable upside, analysts plainly believe O’Reilly Automotive is more favorable than Tilly’s.

Risk & Volatility

Tilly’s has a beta of 0.06, indicating that its share price is 94% less volatile than the S&P 500. Comparatively, O’Reilly Automotive has a beta of 0.54, indicating that its share price is 46% less volatile than the S&P 500.

Summary

O’Reilly Automotive beats Tilly’s on 11 of the 14 factors compared between the two stocks.

About Tilly’s

Tilly’s, Inc. engages in the retail of casual apparel, footwear, and accessories. Its stores are located in retail centers, including malls, lifestyle centers, power centers, community centers, outlet centers, and street-front locations. The company was founded by Hezy Shaked and Tilly Levine in 1982 and is headquartered in Irvine, CA.

About O’Reilly Automotive

O’Reilly Automotive, Inc., together with its subsidiaries, operates as a retailer and supplier of automotive aftermarket parts, tools, supplies, equipment, and accessories in the United States, Puerto Rico, and Mexico. The company provides new and remanufactured automotive hard parts and maintenance items, such as alternators, batteries, brake system components, belts, chassis parts, driveline parts, engine parts, fuel pumps, hoses, starters, temperature control, water pumps, antifreeze, appearance products, engine additives, filters, fluids, lighting products, and oil and wiper blades; and accessories, including floor mats, seat covers, and truck accessories. It also offers auto body paint and related materials, automotive tools, and professional service provider service equipment. In addition, the company provide enhanced services and programs comprising used oil, oil filter, and battery recycling; battery, wiper, and bulb replacement; battery diagnostic testing; electrical and module testing; check engine light code extraction; loaner tool program; drum and rotor resurfacing; custom hydraulic hoses; and professional paint shop mixing and related materials. Further, it offers do-it-yourself and professional service for domestic and imported automobiles, vans, and trucks. The company was founded in 1957 and is headquartered in Springfield, Missouri.