Comparing Kontoor Brands (NYSE:KTB) & Revolve Group (NYSE:RVLV)

Kontoor Brands (NYSE:KTB) and Revolve Group (NYSE:RVLV) are both consumer discretionary companies, but which is the superior investment? We will compare the two businesses based on the strength of their profitability, dividends, institutional ownership, valuation, risk, analyst recommendations and earnings.

Insider & Institutional Ownership

93.1% of Kontoor Brands shares are held by institutional investors. Comparatively, 67.6% of Revolve Group shares are held by institutional investors. 1.8% of Kontoor Brands shares are held by insiders. Comparatively, 43.8% of Revolve Group shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Kontoor Brands and Revolve Group”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Kontoor Brands	$3.15 billion	1.18	$227.45 million	$4.05	16.66
Revolve Group	$1.23 billion	1.36	$61.71 million	$0.85	27.36

Kontoor Brands has higher revenue and earnings than Revolve Group. Kontoor Brands is trading at a lower price-to-earnings ratio than Revolve Group, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current recommendations and price targets for Kontoor Brands and Revolve Group, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Kontoor Brands	1	3	5	1	2.60
Revolve Group	0	7	8	0	2.53

Kontoor Brands presently has a consensus target price of $91.00, indicating a potential upside of 34.86%. Revolve Group has a consensus target price of $29.50, indicating a potential upside of 26.83%. Given Kontoor Brands’ stronger consensus rating and higher possible upside, analysts clearly believe Kontoor Brands is more favorable than Revolve Group.

Volatility and Risk

Kontoor Brands has a beta of 1.05, suggesting that its share price is 5% more volatile than the S&P 500. Comparatively, Revolve Group has a beta of 1.8, suggesting that its share price is 80% more volatile than the S&P 500.

Profitability

This table compares Kontoor Brands and Revolve Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Kontoor Brands	7.22%	62.02%	12.73%
Revolve Group	5.03%	12.12%	7.90%

Summary

Kontoor Brands beats Revolve Group on 10 of the 15 factors compared between the two stocks.

About Kontoor Brands

Kontoor Brands, Inc., a lifestyle apparel company, designs, produces, procures, markets, distributes, and licenses denim, apparel, footwear, and accessories, primarily under the Wrangler and Lee brands. The company operates through two segments: Wrangler and Lee. It licenses and sells apparel under the Rock & Republic brand name. The company sells its products primarily through mass merchants, specialty stores, mid-tier and traditional department stores, company-operated stores, and online. It operates in the Americas, Europe, the Middle East, Africa, and the Asia-Pacific regions. Kontoor Brands, Inc. was incorporated in 2018 and is headquartered in Greensboro, North Carolina.

About Revolve Group

Revolve Group, Inc. operates as an online fashion retailer for millennial and generation z consumers in the United States and internationally. The company operates in two segments, REVOLVE and FWRD. It operates a platform that connects consumers and global fashion influencers, as well as emerging, established, and owned brands. The company offers apparel, footwear, accessories, beauty, and home products from emerging, established, and owned brands, as well as luxury brands through its websites and mobile apps. The company was formerly known as Advance Holdings, LLC and changed its name to Revolve Group, Inc. in October 2018. Revolve Group, Inc. was founded in 2003 and is headquartered in Cerritos, California.