Financial Review: Stein Mart (SMRT) versus Its Competitors

Stein Mart (NASDAQ: SMRT) is one of 31 public companies in the “Apparel & Accessories Retailers” industry, but how does it weigh in compared to its peers? We will compare Stein Mart to similar businesses based on the strength of its institutional ownership, earnings, analyst recommendations, valuation, risk, profitability and dividends.

Dividends

Stein Mart pays an annual dividend of $0.15 per share and has a dividend yield of 12.8%. Stein Mart pays out -24.2% of its earnings in the form of a dividend. As a group, “Apparel & Accessories Retailers” companies pay a dividend yield of 2.5% and pay out 56.4% of their earnings in the form of a dividend. Stein Mart is clearly a better dividend stock than its peers, given its higher yield and lower payout ratio.

Insider & Institutional Ownership

20.3% of Stein Mart shares are owned by institutional investors. Comparatively, 73.7% of shares of all “Apparel & Accessories Retailers” companies are owned by institutional investors. 34.7% of Stein Mart shares are owned by company insiders. Comparatively, 16.4% of shares of all “Apparel & Accessories Retailers” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations for Stein Mart and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Stein Mart 0 0 0 0 N/A
Stein Mart Competitors 528 3089 2978 89 2.39

As a group, “Apparel & Accessories Retailers” companies have a potential upside of 6.42%. Given Stein Mart’s peers higher probable upside, analysts clearly believe Stein Mart has less favorable growth aspects than its peers.

Profitability

This table compares Stein Mart and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Stein Mart -2.18% -44.60% -5.30%
Stein Mart Competitors 1.76% 5.65% 6.10%

Volatility and Risk

Stein Mart has a beta of 0.82, meaning that its stock price is 18% less volatile than the S&P 500. Comparatively, Stein Mart’s peers have a beta of 0.96, meaning that their average stock price is 4% less volatile than the S&P 500.

Earnings & Valuation

This table compares Stein Mart and its peers gross revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Stein Mart $1.36 billion $400,000.00 -1.89
Stein Mart Competitors $3.99 billion $181.38 million 946.09

Stein Mart’s peers have higher revenue and earnings than Stein Mart. Stein Mart is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Summary

Stein Mart peers beat Stein Mart on 8 of the 11 factors compared.

About Stein Mart

Stein Mart, Inc. is a national retailer offering the fashion merchandise, service and presentation of a department or specialty store. The Company offers apparel for women and men, as well as accessories, shoes and home fashions. The Company’s target customers are women over 45 years old. The Company operates approximately 280 stores in over 30 states and an Internet store. Its stores are located in the Northeast, Midwest, Southeast, Texas and the Southwest. It is concentrated in the Southeast and Texas where over 180 of its stores are located. The Company’s stores offer a range of services, such as merchandise locator service, a Preferred Customer program, co-branded and private label credit card programs, and electronic gift cards. The Company’s merchants purchase products from approximately 1,200 vendors. It leases all of its store locations, generally for approximately 10 years with options to extend the lease term for over two or five year periods.

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