Critical Review: ON (NYSE:ONON) vs. Industria de Diseno Textil (OTCMKTS:IDEXY)

ON (NYSE:ONON) and Industria de Diseno Textil (OTCMKTS:IDEXY) are both large-cap retail/wholesale companies, but which is the superior investment? We will compare the two businesses based on the strength of their earnings, analyst recommendations, dividends, institutional ownership, valuation, risk and profitability.

Institutional and Insider Ownership

36.4% of ON shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

ON has a beta of 2.15, suggesting that its share price is 115% more volatile than the S&P 500. Comparatively, Industria de Diseno Textil has a beta of 0.94, suggesting that its share price is 6% less volatile than the S&P 500.

Profitability

This table compares ON and Industria de Diseno Textil’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ON	7.45%	14.81%	8.48%
Industria de Diseno Textil	15.40%	32.94%	17.22%

Valuation & Earnings

This table compares ON and Industria de Diseno Textil”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ON	$2.63 billion	10.97	$275.23 million	$0.77	59.74
Industria de Diseno Textil	$41.81 billion	5.06	$6.32 billion	$0.55	30.87

Industria de Diseno Textil has higher revenue and earnings than ON. Industria de Diseno Textil is trading at a lower price-to-earnings ratio than ON, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations and price targets for ON and Industria de Diseno Textil, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ON	2	3	17	2	2.79
Industria de Diseno Textil	0	0	1	5	3.83

ON currently has a consensus price target of $59.86, indicating a potential upside of 30.15%. Given ON’s higher probable upside, research analysts clearly believe ON is more favorable than Industria de Diseno Textil.

About ON

On Holding AG engages in the development and distribution of sports products such as footwear, apparel, and accessories for high-performance running, outdoor, all-day activities, and tennis. It sells its products worldwide through independent retailers and global distributors, its own online presence, and its own stores. The company was founded by David Allemann, Olivier Bernhard, and Caspar Coppetti in January 2010 and is headquartered in Zurich, Switzerland.

About Industria de Diseno Textil

Industria de Diseño Textil, S.A. engages in the retail and online distribution of clothing, footwear, accessories, and household products. The company sells its products under the Zara, Pull & Bear, Massimo Dutti, Bershka, Stradivarius, Oysho, and Zara Home brands. It is also involved in the textile manufacturing, logistics, design, insurance, construction, and real estate businesses, as well as provides financial services. The company operates in Spain, rest of Europe, the Americas, Asia, and internationally. Industria de Diseño Textil, S.A. was founded in 1963 and is headquartered in A Coruña, Spain.