Critical Analysis: JOANN (NASDAQ:JOANQ) and DICK’S Sporting Goods (NYSE:DKS)

DICK’S Sporting Goods (NYSE:DKS) and JOANN (NASDAQ:JOANQ) are both retail/wholesale companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, risk, institutional ownership, profitability and analyst recommendations.

Profitability

This table compares DICK’S Sporting Goods and JOANN’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DICK’S Sporting Goods	8.06%	42.99%	11.97%
JOANN	-11.10%	N/A	-4.99%

Volatility & Risk

DICK’S Sporting Goods has a beta of 1.58, indicating that its share price is 58% more volatile than the S&P 500. Comparatively, JOANN has a beta of 0.81, indicating that its share price is 19% less volatile than the S&P 500.

Insider and Institutional Ownership

89.8% of DICK’S Sporting Goods shares are held by institutional investors. Comparatively, 72.1% of JOANN shares are held by institutional investors. 30.8% of DICK’S Sporting Goods shares are held by insiders. Comparatively, 73.4% of JOANN shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Valuation & Earnings

This table compares DICK’S Sporting Goods and JOANN’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DICK’S Sporting Goods	$12.98 billion	1.29	$1.05 billion	$12.18	16.68
JOANN	$2.22 billion	0.00	-$200.60 million	($5.81)	-0.01

DICK’S Sporting Goods has higher revenue and earnings than JOANN. JOANN is trading at a lower price-to-earnings ratio than DICK’S Sporting Goods, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of recent ratings and target prices for DICK’S Sporting Goods and JOANN, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DICK’S Sporting Goods	0	11	11	0	2.50
JOANN	0	0	0	0	N/A

DICK’S Sporting Goods presently has a consensus price target of $208.64, indicating a potential upside of 2.71%. Given DICK’S Sporting Goods’ higher possible upside, research analysts clearly believe DICK’S Sporting Goods is more favorable than JOANN.

Summary

DICK’S Sporting Goods beats JOANN on 12 of the 13 factors compared between the two stocks.

About DICK’S Sporting Goods

DICK'S Sporting Goods, Inc., together with its subsidiaries, operates as a sporting goods retailer primarily in the United States. The company provides hardlines, includes sporting goods equipment, fitness equipment, golf equipment, and hunting and fishing gear products; apparel; and footwear and accessories. It also owns and operates Sporting Goods, Golf Galaxy, Field & Stream, Public Lands, Going Going Gone!, and other specialty concept stores; and DICK'S House of Sports and Golf Galaxy Performance Center, as well as GameChanger, a youth sports mobile application for video streaming, scorekeeping, scheduling, and communications. The company sells its product through e-commerce websites and mobile applications. The company was formerly known as Dick'S Clothing and Sporting Goods, Inc. and changed its name to DICK'S Sporting Goods, Inc. in April 1999. DICK'S Sporting Goods, Inc. was incorporated in 1948 and is headquartered in Coraopolis, Pennsylvania.

About JOANN

JOANN Inc. involved in the sewing and fabrics industry. It serves as a convenient single source for all of the supplies, guidance and inspiration needed to achieve any project or passion. JOANN Inc. is based in HUDSON, Ohio.