Financial Review: lululemon athletica (NASDAQ:LULU) vs. Weyco Group (NASDAQ:WEYS)

Weyco Group (NASDAQ:WEYS) and lululemon athletica (NASDAQ:LULU) are both consumer discretionary companies, but which is the better business? We will compare the two companies based on the strength of their valuation, dividends, analyst recommendations, risk, earnings, profitability and institutional ownership.

Risk and Volatility

Weyco Group has a beta of 0.89, indicating that its stock price is 11% less volatile than the S&P 500. Comparatively, lululemon athletica has a beta of 0.87, indicating that its stock price is 13% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings for Weyco Group and lululemon athletica, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Weyco Group	0	0	1	0	3.00
lululemon athletica	6	22	0	1	1.86

lululemon athletica has a consensus price target of $111.54, suggesting a potential upside of 12.23%. Given lululemon athletica’s higher possible upside, analysts plainly believe lululemon athletica is more favorable than Weyco Group.

Insider and Institutional Ownership

23.6% of Weyco Group shares are owned by institutional investors. Comparatively, 85.2% of lululemon athletica shares are owned by institutional investors. 36.4% of Weyco Group shares are owned by insiders. Comparatively, 0.5% of lululemon athletica shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Valuation and Earnings

This table compares Weyco Group and lululemon athletica”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Weyco Group	$276.17 million	1.54	$23.08 million	$3.63	12.26
lululemon athletica	$11.09 billion	1.04	$1.58 billion	$12.21	8.14

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

Profitability

This table compares Weyco Group and lululemon athletica’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Weyco Group	12.39%	14.04%	11.28%
lululemon athletica	12.78%	27.69%	15.81%

Summary

lululemon athletica beats Weyco Group on 9 of the 15 factors compared between the two stocks.

About Weyco Group

Weyco Group, Inc. designs and distributes footwear for men, women, and children. It operates in two segments, North American Wholesale Operations and North American Retail Operations. The company offers mid-priced leather dress shoes and casual footwear of man-made materials and leather; and outdoor boots, shoes, and sandals under the Florsheim, Nunn Bush, Stacy Adams, BOGS, Rafters, and Forsake brands. It is also involved in the wholesale of its products to footwear, department, and specialty stores, as well as e-commerce retailers in the United States and Canada. The company operates e-commerce business; and brick and mortar retail stores in the United States. In addition, it has licensing agreements with third parties, who sell its branded apparel, accessories, and specialty footwear. It operates in the United States, Canada, Australia, and South Africa. The company was formerly known as Weyenberg Shoe Manufacturing Company and changed its name to Weyco Group, Inc. in April 1990. Weyco Group, Inc. was incorporated in 1906 and is based in Milwaukee, Wisconsin.

About lululemon athletica

Lululemon Athletica Inc., together with its subsidiaries, designs, distributes, and retails athletic apparel, footwear, and accessories under the lululemon brand for women and men. It offers pants, shorts, tops, and jackets for healthy lifestyle, such as yoga, running, training, and other activities. It also provides fitness-inspired accessories. The company sells its products through a chain of company-operated stores; outlets; interactive workout platform; yoga and fitness studios, university campus retailers, and other partners; license and supply arrangements; and temporary locations, as well as through mobile apps and lululemon.com e-commerce website. It has operations in the United States, Canada, Mainland China, Australia, South Korea, Hong Kong, Japan, New Zealand, Taiwan, Singapore, Malaysia, Macau, Thailand, the Asia Pacific, the United Kingdom, Germany, France, Ireland, Spain, the Netherlands, Sweden, Norway, Switzerland, Europe, the Middle East, and Africa. Lululemon Athletica Inc. was founded in 1998 and is based in Vancouver, Canada.