Contrasting Li Ning (OTCMKTS:LNNGY) & Ulta Beauty (NASDAQ:ULTA)

Ulta Beauty (NASDAQ:ULTA) and Li Ning (OTCMKTS:LNNGY) are both consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their profitability, valuation, analyst recommendations, risk, earnings, dividends and institutional ownership.

Earnings and Valuation

This table compares Ulta Beauty and Li Ning”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ulta Beauty	$12.39 billion	1.87	$1.15 billion	$26.67	20.25
Li Ning	$4.12 billion	1.09	$408.36 million	N/A	N/A

Ulta Beauty has higher revenue and earnings than Li Ning.

Profitability

This table compares Ulta Beauty and Li Ning’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ulta Beauty	9.36%	44.77%	17.27%
Li Ning	N/A	N/A	N/A

Risk & Volatility

Ulta Beauty has a beta of 0.87, meaning that its share price is 13% less volatile than the S&P 500. Comparatively, Li Ning has a beta of 0.33, meaning that its share price is 67% less volatile than the S&P 500.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Ulta Beauty and Li Ning, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ulta Beauty	1	6	19	1	2.74
Li Ning	1	0	0	1	2.50

Ulta Beauty currently has a consensus target price of $636.41, suggesting a potential upside of 17.83%. Given Ulta Beauty’s stronger consensus rating and higher probable upside, analysts plainly believe Ulta Beauty is more favorable than Li Ning.

Insider and Institutional Ownership

90.4% of Ulta Beauty shares are held by institutional investors. 0.2% of Ulta Beauty shares are held 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.

Summary

Ulta Beauty beats Li Ning on 12 of the 12 factors compared between the two stocks.

About Ulta Beauty

Ulta Beauty, Inc. operates as a specialty beauty retailer in the United States. The company offers branded and private label beauty products, including cosmetics, fragrance, haircare, skincare, bath and body products, professional hair products, and salon styling tools through its Ulta Beauty stores, shop-in-shops, Ulta.com website, and its mobile applications. It also offers beauty services, including hair, makeup, brow, and skin services at its stores. The company was formerly known as ULTA Salon, Cosmetics & Fragrance, Inc. and changed its name to Ulta Beauty, Inc. in January 2017. Ulta Beauty, Inc. was incorporated in 1990 and is based in Bolingbrook, Illinois.

About Li Ning

Li Ning Company Limited, a sports brand company, engages in the research and development, design, manufacture, marketing, distribution, and retail of sporting goods in the People’s Republic of China. The company offers sporting goods, including professional and leisure footwear, apparel, equipment, and accessories under the LI-NING brand. It also develops, manufactures, markets, distributes, and/or sells outdoor sports products under the AIGLE brand; table tennis products under the Double Happiness brand name; fashionable fitness products for dance and yoga under the Danskin brand; and badminton products under the Kason brand name. The company also provides brand licensing, administrative, and property management services. It operates conventional stores, flagship stores, China LI-NING stores, LI-NING 1990 stores, factory outlets, and multi-brand stores under the LI-NING brand. The company was founded in 1990 and is headquartered in Beijing, the People’s Republic of China.