Head to Head Survey: BARK (NYSE:BARK) and Cato (NYSE:CATO)

Cato (NYSE:CATO) and BARK (NYSE:BARK) are both small-cap consumer discretionary companies, but which is the superior business? We will compare the two companies based on the strength of their institutional ownership, earnings, profitability, analyst recommendations, dividends, valuation and risk.

Institutional & Insider Ownership

61.1% of Cato shares are owned by institutional investors. Comparatively, 28.8% of BARK shares are owned by institutional investors. 18.3% of Cato shares are owned by company insiders. Comparatively, 14.8% of BARK shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Risk & Volatility

Cato has a beta of 0.55, suggesting that its share price is 45% less volatile than the S&P 500. Comparatively, BARK has a beta of 1.98, suggesting that its share price is 98% more volatile than the S&P 500.

Valuation & Earnings

This table compares Cato and BARK”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Cato	$643.67 million	0.08	-$5.91 million	($0.30)	-8.15
BARK	$394.84 million	0.18	-$39.01 million	($3.58)	-2.24

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

Profitability

This table compares Cato and BARK’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Cato	-0.87%	-3.39%	-1.29%
BARK	-8.42%	-35.66%	-14.54%

Analyst Recommendations

This is a summary of recent ratings for Cato and BARK, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Cato	1	0	0	0	1.00
BARK	1	2	2	0	2.20

BARK has a consensus target price of $15.33, indicating a potential upside of 90.81%. Given BARK’s stronger consensus rating and higher possible upside, analysts plainly believe BARK is more favorable than Cato.

Summary

Cato beats BARK on 8 of the 14 factors compared between the two stocks.

About Cato

The Cato Corporation, together with its subsidiaries, operates as a specialty retailer of fashion apparel and accessories primarily in the southeastern United States. It operates through two segments, Retail and Credit. The company's stores and e-commerce websites offer a range of apparel and accessories, including dressy, career, and casual sportswear; and dresses, coats, shoes, lingerie, costume jewelry, and handbags, as well as men's wear, and lines for kids and infants. It operates its stores and e-commerce websites under the Cato, Cato Fashions, Cato Plus, It's Fashion, It's Fashion Metro, and Versona names. It also provides credit card services to its customers, as well as layaway plans for customers. The Cato Corporation was incorporated in 1946 and is headquartered in Charlotte, North Carolina.

About BARK

BARK Inc., a dog-centric company, provides products, services, and content for dogs. It operates in two segments, Direct to Consumer and Commerce. The company serves dogs through monthly subscription services. It is also involved in the design of playstyle-specific toys, satisfying treats, personal meal plans with supplements, and dog-first experiences designed to foster health and happiness of dogs everywhere. In addition, the company offers monthly themed box of toys and treats under the BarkBox and Super Chewer names; personalized meal plans under the BARK Food name; health and wellness products under the BARK Bright name; and dog beds, bowls, collars, harnesses, and leashes under the BARK Home brand. Further, the company sells BARK Home products through BarkShop.com. Additionally, it offers custom collections through online marketplaces, and brick and mortar retailers. The company was formerly known as The Original BARK Company and changed its name to BARK, Inc. in November 2021. BARK Inc. was incorporated in 2011 and is headquartered in New York, New York.