Comparing Michael Kors Holdings Limited (NYSE:KORS) and Lands’ End (LE)

Michael Kors Holdings Limited (NYSE: KORS) and Lands’ End (NASDAQ:LE) are both consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, risk, earnings, profitability, institutional ownership, valuation and analyst recommendations.

Earnings and Valuation

This table compares Michael Kors Holdings Limited and Lands’ End’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Michael Kors Holdings Limited $4.46 billion 1.65 $1.07 billion $3.22 15.10
Lands’ End $1.34 billion 0.29 $39.65 million ($3.55) -3.44

Michael Kors Holdings Limited has higher revenue and earnings than Lands’ End. Lands’ End is trading at a lower price-to-earnings ratio than Michael Kors Holdings Limited, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Michael Kors Holdings Limited and Lands’ End’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Michael Kors Holdings Limited 11.91% 40.26% 26.12%
Lands’ End -8.48% -0.73% -0.19%

Risk and Volatility

Michael Kors Holdings Limited has a beta of 0.02, suggesting that its stock price is 98% less volatile than the S&P 500. Comparatively, Lands’ End has a beta of 0.32, suggesting that its stock price is 68% less volatile than the S&P 500.

Institutional and Insider Ownership

83.4% of Michael Kors Holdings Limited shares are held by institutional investors. Comparatively, 60.5% of Lands’ End shares are held by institutional investors. 6.0% of Michael Kors Holdings Limited shares are held by insiders. Comparatively, 0.5% of Lands’ End shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current recommendations and price targets for Michael Kors Holdings Limited and Lands’ End, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Michael Kors Holdings Limited 3 18 6 0 2.11
Lands’ End 0 1 0 0 2.00

Michael Kors Holdings Limited currently has a consensus price target of $44.92, indicating a potential downside of 7.61%. Lands’ End has a consensus price target of $15.00, indicating a potential upside of 22.95%. Given Lands’ End’s higher probable upside, analysts plainly believe Lands’ End is more favorable than Michael Kors Holdings Limited.

Summary

Michael Kors Holdings Limited beats Lands’ End on 11 of the 13 factors compared between the two stocks.

Michael Kors Holdings Limited Company Profile

Michael Kors Holdings Limited is a designer, marketer, distributor and retailer of branded women’s apparel and accessories and men’s apparel bearing the Michael Kors tradename and related trademarks MICHAEL KORS, MICHAEL MICHAEL KORS, and various other related trademarks and logos. The Company operates through three segments: retail, wholesale and licensing. The Retail operations consist of collection stores and lifestyle stores, including concessions and outlet stores, located primarily in the Americas (the United States, Canada and Latin America), Europe and Asia, as well as e-commerce. Wholesale revenues are principally derived from major department and specialty stores located throughout the Americas, Europe and Asia. The Company licenses its trademarks on products, such as fragrances, beauty, eyewear, leather goods, jewelry, watches, coats, men’s suits, swimwear, furs and ties, as well as through geographic licenses.

Lands’ End Company Profile

Lands’ End, Inc. (Lands’ End) is a multi-channel retailer of casual clothing, accessories and footwear, as well as home products. The Company operates through two segments: Direct and Retail. The Company offers products through catalogs, online at www.landsend.com. The Direct segment sells products through the Company’s e-commerce Websites, international Websites and direct mail catalogs. The Retail segment sells products and services through Lands’ End Shops at Sears across the United States, the Company’s standalone Lands’ End Inlet stores and international shop-in-shops. The Company’s product categories include Apparel and Non-apparel. The Non-apparel category offers accessories, footwear and home goods. The Company provides embroidery, monogramming, gift wrapping, shipping and other services. In addition, the Company offers sheets and pillowcases, duvet covers and comforters, blankets and throws, mattress pads, towels, rugs and mats, school uniforms and shower curtains.

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