Analyzing Viacom (VIA) and Abercrombie & Fitch (ANF)

Viacom (NASDAQ: VIA) and Abercrombie & Fitch (NYSE:ANF) are both consumer discretionary companies, but which is the superior investment? We will compare the two companies based on the strength of their profitability, earnings, valuation, analyst recommendations, risk, institutional ownership and dividends.

Analyst Ratings

This is a summary of recent ratings and price targets for Viacom and Abercrombie & Fitch, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Viacom 2 1 1 0 1.75
Abercrombie & Fitch 5 12 3 0 1.90

Viacom currently has a consensus target price of $39.00, indicating a potential upside of 20.56%. Abercrombie & Fitch has a consensus target price of $18.29, indicating a potential downside of 28.15%. Given Viacom’s higher probable upside, equities research analysts plainly believe Viacom is more favorable than Abercrombie & Fitch.

Profitability

This table compares Viacom and Abercrombie & Fitch’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Viacom 16.74% 24.97% 6.76%
Abercrombie & Fitch 0.20% 4.86% 2.57%

Dividends

Viacom pays an annual dividend of $0.80 per share and has a dividend yield of 2.5%. Abercrombie & Fitch pays an annual dividend of $0.80 per share and has a dividend yield of 3.1%. Abercrombie & Fitch pays out 123.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Valuation & Earnings

This table compares Viacom and Abercrombie & Fitch’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Viacom $13.26 billion 0.98 $1.87 billion N/A N/A
Abercrombie & Fitch $3.49 billion 0.49 $7.09 million $0.65 39.15

Viacom has higher revenue and earnings than Abercrombie & Fitch.

Institutional and Insider Ownership

2.3% of Viacom shares are held by institutional investors. Comparatively, 99.3% of Abercrombie & Fitch shares are held by institutional investors. 0.7% of Viacom shares are held by company insiders. Comparatively, 0.6% of Abercrombie & Fitch shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Volatility & Risk

Viacom has a beta of 1.27, indicating that its share price is 27% more volatile than the S&P 500. Comparatively, Abercrombie & Fitch has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500.

Summary

Viacom beats Abercrombie & Fitch on 10 of the 15 factors compared between the two stocks.

Viacom Company Profile

Viacom, Inc. operates media brands that create entertainment content worldwide. The company creates television programs, motion pictures, short-form content, games, consumer products, podcasts, live events, and social media experiences. It operates through two segments, Media Networks and Filmed Entertainment. The Media Networks segment provides entertainment content and related branded products for consumers through approximately 300 locally programmed and operated TV channels, including Nickelodeon, Nick Jr., MTV, BET, Comedy Central, SPIKE, VH1, TV Land, CMT, Logo, Channel 5, Telefe, Colors, Paramount Channel, TeenNick, Nicktoons, Nick Music, MTV2, MTV Classic, MTV Live, BET Her, BET Gospel, and BET Hip Hop, as well as through online, mobile, and apps. The Filmed Entertainment segment produces, finances, acquires, and distributes motion pictures, television programming, and other entertainment content under the Paramount Pictures, Paramount Players, Paramount Animation, Paramount Television, Nickelodeon Movies, and MTV Films brands. This segment exhibits motion pictures theatrically through home entertainment, licensing to television and digital platforms, and ancillary activities. The company releases its content through DVDs, Blu-ray discs, transactional video-on-demand, subscription video-on-demand, pay television, cable television, free television, and free video-on-demand, as well as airlines and hotels. Viacom, Inc. is headquartered in New York, New York.

Abercrombie & Fitch Company Profile

Abercrombie & Fitch Co., through its subsidiaries, operates as a specialty retailer. The Company operates in two segments, Hollister and Abercrombie. It offers apparel, intimates, personal care products, and accessories for men, women, and kids under the Hollister, Abercrombie & Fitch, abercrombie kids, and Gilly Hicks brand names. As of March 7, 2018, it operated approximately 850 stores in North America, Europe, Asia, and the Middle East. The company sells products through its stores and direct-to-consumer operations; various third-party wholesale, franchise, and licensing arrangements; and e-commerce sites, including abercrombie.com and hollisterco.com. Abercrombie & Fitch Co. was founded in 1892 and is headquartered in New Albany, Ohio.

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