Analyzing Best Buy (NYSE:BBY) and Tandy Leather Factory (NASDAQ:TLF)

Best Buy (NYSE:BBY) and Tandy Leather Factory (NASDAQ:TLF) are both consumer discretionary companies, but which is the better business? We will contrast the two companies based on the strength of their risk, institutional ownership, earnings, dividends, valuation, analyst recommendations and profitability.

Institutional and Insider Ownership

81.0% of Best Buy shares are owned by institutional investors. Comparatively, 56.4% of Tandy Leather Factory shares are owned by institutional investors. 0.5% of Best Buy shares are owned by company insiders. Comparatively, 36.2% of Tandy Leather Factory shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Volatility & Risk

Best Buy has a beta of 1.26, meaning that its share price is 26% more volatile than the S&P 500. Comparatively, Tandy Leather Factory has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Best Buy and Tandy Leather Factory, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Best Buy	2	12	6	1	2.29
Tandy Leather Factory	1	0	0	0	1.00

Best Buy presently has a consensus target price of $85.65, suggesting a potential upside of 1.37%. Given Best Buy’s stronger consensus rating and higher probable upside, research analysts plainly believe Best Buy is more favorable than Tandy Leather Factory.

Profitability

This table compares Best Buy and Tandy Leather Factory’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Best Buy	3.01%	48.14%	9.16%
Tandy Leather Factory	-2.14%	-3.31%	-1.98%

Valuation and Earnings

This table compares Best Buy and Tandy Leather Factory”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Best Buy	$41.69 billion	0.43	$1.07 billion	$6.01	14.06
Tandy Leather Factory	$76.32 million	0.27	$9.10 million	($0.17)	-14.91

Best Buy has higher revenue and earnings than Tandy Leather Factory. Tandy Leather Factory is trading at a lower price-to-earnings ratio than Best Buy, indicating that it is currently the more affordable of the two stocks.

Summary

Best Buy beats Tandy Leather Factory on 14 of the 15 factors compared between the two stocks.

About Best Buy

Best Buy Co., Inc. engages in the retail of technology products in the United States, Canada, and international. Its stores provide computing and mobile phone products, such as desktops, notebooks, and peripherals; mobile phones comprising related mobile network carrier commissions; networking products; tablets covering e-readers; smartwatches; and consumer electronics consisting of digital imaging, health and fitness products, portable audio comprising headphones and portable speakers, and smart home products, as well as home theaters, which includes home theater accessories, soundbars, and televisions. The company's stores also offer appliances, such as dishwashers, laundry, ovens, refrigerators, blenders, coffee makers, vacuums, and personal care; entertainment products consisting of drones, peripherals, movies, and toys, as well as hardware and software, and virtual reality and other software products; and other products, such as baby, food and beverage, luggage, outdoor living, and sporting goods. In addition, it provides delivery, installation, memberships, repair, set-up, technical support, health-related, and warranty-related services. The company offers its products through stores and websites under the Best Buy, Best Buy Ads, Best Buy Business, Best Buy Health, Buy Mobile, CST, Current Health, Geek Squad, Lively, Magnolia, Pacific Kitchen, Home, TechLiquidators, and Yardbird brands, as well as domain names comprising bestbuy.com, currenthealth.com, lively.com, techliquidators.com, yardbird.com, and bestbuy.ca. The company was formerly known as Sound of Music, Inc. Best Buy Co., Inc. was incorporated in 1966 and is headquartered in Richfield, Minnesota.

About Tandy Leather Factory

Tandy Leather Factory, Inc. engages in the distribution of leather and related products. It offers leather, leatherworking tools, buckles and adornments for belts, leather dyes and finishes, saddle and tack hardware, and do-it-yourself kits. It operates through North America and International geographical segments. The North America geographical segment consists of 115 stores, which offer a broad selection of products combined with leathercraft expertise in a one-stop shop. The International geographical segment comprises of similar to North America segment but generally located in light industrial areas. The company was founded by J. Wray Thompson, Sr. and Ronald C. Morgan in 1980 and is headquartered in Fort Worth, TX.