Head-To-Head Review: Kontoor Brands (NYSE:KTB) and Ralph Lauren (NYSE:RL)

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

Dividends

Ralph Lauren pays an annual dividend of $2.75 per share and has a dividend yield of 2.5%. Kontoor Brands does not pay a dividend. Ralph Lauren pays out 38.2% of its earnings in the form of a dividend.

Insider & Institutional Ownership

66.0% of Ralph Lauren shares are held by institutional investors. Comparatively, 0.1% of Kontoor Brands shares are held by institutional investors. 34.3% of Ralph Lauren shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Ralph Lauren and Kontoor Brands’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ralph Lauren 6.83% 17.38% 9.70%
Kontoor Brands N/A N/A N/A

Analyst Ratings

This is a breakdown of current recommendations for Ralph Lauren and Kontoor Brands, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ralph Lauren 2 6 9 0 2.41
Kontoor Brands 1 4 3 0 2.25

Ralph Lauren currently has a consensus price target of $134.00, suggesting a potential upside of 21.52%. Kontoor Brands has a consensus price target of $29.58, suggesting a potential upside of 0.32%. Given Ralph Lauren’s stronger consensus rating and higher possible upside, research analysts clearly believe Ralph Lauren is more favorable than Kontoor Brands.

Earnings & Valuation

This table compares Ralph Lauren and Kontoor Brands’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ralph Lauren $6.31 billion 1.36 $430.90 million $7.19 15.34
Kontoor Brands N/A N/A N/A N/A N/A

Ralph Lauren has higher revenue and earnings than Kontoor Brands.

Summary

Ralph Lauren beats Kontoor Brands on 10 of the 11 factors compared between the two stocks.

About Ralph Lauren

Ralph Lauren Corp. engages in the design, marketing and distribution of premium lifestyle products. The firm offers apparel, accessories, home furnishings, and other licensed product. It operates through the following segments: North America, Europe, and Asia. The North America segment consists of sales of Ralph Lauren branded apparel, accessories, home furnishings, and related products made through the Company’s wholesale and retail businesses in the U.S. and Canada, excluding Club Monaco. The Europe segment caters to sales of Ralph Lauren branded apparel, accessories, home furnishings, and related products made through the Company’s wholesale and retail businesses in Europe and the Middle East, excluding Club Monaco. The Asia segment covers the sales of Ralph Lauren branded apparel, accessories, home furnishings, and related products made through the Company’s wholesale and retail businesses in Asia, Australia, and New Zealand. The company was founded by Ralph Lauren in 1967 and is headquartered in New York, NY.

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