Analyzing Warby Parker (NYSE:WRBY) and Duluth (NASDAQ:DLTH)

Duluth (NASDAQ:DLTH) and Warby Parker (NYSE:WRBY) are both consumer discretionary companies, but which is the better stock? We will contrast the two businesses based on the strength of their earnings, risk, valuation, institutional ownership, profitability, analyst recommendations and dividends.

Earnings and Valuation

This table compares Duluth and Warby Parker”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Duluth	$565.18 million	0.26	-$16.39 million	$0.14	27.86
Warby Parker	$871.91 million	3.44	$1.64 million	$0.07	396.33

Warby Parker has higher revenue and earnings than Duluth. Duluth is trading at a lower price-to-earnings ratio than Warby Parker, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Duluth and Warby Parker’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Duluth	1.07%	-3.03%	-1.21%
Warby Parker	0.85%	3.36%	1.72%

Analyst Recommendations

This is a summary of current ratings for Duluth and Warby Parker, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Duluth	0	3	0	1	2.50
Warby Parker	1	3	7	0	2.55

Duluth currently has a consensus target price of $5.00, suggesting a potential upside of 28.21%. Warby Parker has a consensus target price of $30.08, suggesting a potential upside of 8.44%. Given Duluth’s higher probable upside, research analysts clearly believe Duluth is more favorable than Warby Parker.

Volatility and Risk

Duluth has a beta of 1.38, meaning that its share price is 38% more volatile than the S&P 500. Comparatively, Warby Parker has a beta of 1.91, meaning that its share price is 91% more volatile than the S&P 500.

Insider and Institutional Ownership

24.4% of Duluth shares are owned by institutional investors. Comparatively, 93.2% of Warby Parker shares are owned by institutional investors. 40.4% of Duluth shares are owned by company insiders. Comparatively, 16.8% of Warby Parker shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

Warby Parker beats Duluth on 10 of the 15 factors compared between the two stocks.

About Duluth

Duluth Holdings Inc. sells casual wear, workwear, and accessories for men and women under the Duluth Trading brand in the United States. It provides shirts, pants, underwear, tanks, outerwear, footwear, accessories, and hard goods. The company offers its products under various trademarks, trade names, and service marks, including Alaskan Hardgear, Armachillo, Ballroom, Bucket Master, Cab Commander, Crouch Gusset, Dry on the Fly, Duluth Trading Co, Duluthflex, Fire Hose, Longtail T, No-Yank, No Polo Shirt, Wild Boar Mocs, and Buck Naked. Duluth Holdings Inc. markets its products through its Website, catalogs, and retail stores. As of May 17, 2018, it operated 36 retail stores. The company was formerly known as GEMPLER'S, Inc. Duluth Holdings Inc. was founded in 1989 and is headquartered in Belleville, Wisconsin.

About Warby Parker

Warby Parker Inc. provides eyewear products in the United States and Canada. The company offers eyeglasses, sunglasses, light-responsive lenses, blue-light-filtering lenses, non-prescription lenses, and contact lenses. It also provides accessories, such as cases, lenses kit with anti-fog spray, pouches, and anti-fog lens spray through its retail stores, website, and mobile apps. In addition, the company offers eye exams and vision tests. Warby Parker Inc. was incorporated in 2009 and is headquartered in New York, New York.