Critical Contrast: Signet Jewelers (NYSE:SIG) versus Children’s Place (NASDAQ:PLCE)

Children’s Place (NASDAQ:PLCE) and Signet Jewelers (NYSE:SIG) are both consumer discretionary companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, dividends, profitability, earnings, analyst recommendations, valuation and institutional ownership.

Profitability

This table compares Children’s Place and Signet Jewelers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Children’s Place	-9.09%	N/A	-12.53%
Signet Jewelers	4.29%	22.54%	7.35%

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Children’s Place and Signet Jewelers, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Children’s Place	1	1	0	0	1.50
Signet Jewelers	0	5	5	1	2.64

Children’s Place presently has a consensus price target of $4.00, suggesting a potential upside of 42.35%. Signet Jewelers has a consensus price target of $113.62, suggesting a potential upside of 33.58%. Given Children’s Place’s higher possible upside, equities analysts plainly believe Children’s Place is more favorable than Signet Jewelers.

Valuation & Earnings

This table compares Children’s Place and Signet Jewelers”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Children’s Place	$1.21 billion	0.05	-$88.26 million	($4.84)	-0.58
Signet Jewelers	$6.83 billion	0.49	$294.40 million	$7.13	11.93

Signet Jewelers has higher revenue and earnings than Children’s Place. Children’s Place is trading at a lower price-to-earnings ratio than Signet Jewelers, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Children’s Place has a beta of 1.97, indicating that its stock price is 97% more volatile than the S&P 500. Comparatively, Signet Jewelers has a beta of 1.11, indicating that its stock price is 11% more volatile than the S&P 500.

Summary

Signet Jewelers beats Children’s Place on 11 of the 13 factors compared between the two stocks.

About Children’s Place

The Children’s Place, Inc. engages in the provision of apparel, footwear, accessories, and other items for children. The firm also designs contracts to manufacture and sell fashionable and value-priced merchandise under the brand names of The Children’s Place, Baby Place, and Gymboree. It operates through The Children’s Place U.S. and The Children’s Place International segments. The Children’s Place U.S. segment refers to the company’s U.S. and Puerto Rico-based stores and revenue from its U.S. based wholesale business. The Children’s Place International segment is involved in the Canadian-based stores, revenue from the company’s Canadian-based wholesale business, as well as revenue from international franchisees. The company was founded by David Pulver and Clinton A. Clark in 1969 and is headquartered in Secaucus, NJ.

About Signet Jewelers

Signet Jewelers Limited operates as a diamond jewelry retailer. It operates through three segments: North America, International, and Other. The North America segment operates jewelry stores in jewelry stores in malls, mall-based kiosks, and off-mall locations in the United States and Canada primarily under the Kay Jewelers, Kay Jewelers Outlet, Jared The Galleria Of Jewelry, Jared Vault, Zales Outlet, Zales Jewelers, Diamonds Direct, James Allen, Banter by Piercing Pagoda, and Peoples Jewellers names, as well as operates online through its digital banners, James Allen and Blue Nile. This segment also engages in jewelry subscription business. The International segment operates stores in shopping malls and off-mall locations primarily under the H.Samuel and Ernest Jones brands in the United Kingdom, Republic of Ireland, and Channel Islands. The Other segment is involved in the purchase and conversion of rough diamonds to polished stones, as well as the provision of diamond polishing services. Signet Jewelers Limited is based in Hamilton, Bermuda.